Preamble

The House met at a Quarter before Three of the Clock, Mr. SPEAKER in the Chair.

PRIVATE BUSINESS.

Liverpool Corporation (No. 2) Bill,

Lords Amendments considered, and agreed to.

London Midland and Scottish Railway (No. 1) Bill (Certified Bill),

Nottingham Corporation Bill (Certified Bill),

Lords Amendments considered, pursuant to the Order of the House of 11th December, and agreed to.

Southend-on-Sea Corporation Bill,

Read the Third time, and passed.

Ascot District Gas and Electricity Bill [Lords],

London Building Bill [Lords],

Shoreham Harbour Bill [Lords] (Certified Bill),

Southampton County Council (Bursledon Bridge) Bill [Lords],

Read a Second time, and committed.

Torquay and Paignton Traction Bill [Lords] (Certified Bill),

To be read a Second time To-morrow.

Stoke-on-Trent Extension Bill (by Order),

As amended, considered; to be read the Third time.

Pier and Harbour Provisional Order (No. 1) Bill,

Read the Third time, and passed.

STANDING ORDERS.

Motion made, and Question proposed,
That so much of Standing Order 91 as fixes Five as the quorum of the Select Committee on Standing Orders be read and suspended.—[Mr. Broad.]

Captain CROOKSHANK: May we have an explanation of this Motion?

Mr. SPEAKER: It is in common form.

Mr. BROAD: It is usual every year, after Whitsuntide, for the quorum of the Standing Orders Committee to be reduced from five to three, and, to my knowledge, it has never been set aside.

Mr. HARRIS: Are there not enough Members willing to fulfil this function? It seems rather strange. Can we not have some explanation as to why it is necessary, at this stage of the Session, to reduce the number?

Mr. BROAD: It is common form every year. It is very often difficult to get five Members to attend at this time of the year at the opening of the debate, as the business before the Standing Orders Committee is then of less consequence. It is the usual practice to reduce the quorum to three after Whitsuntide, and it is rarely necessary for the Committee to meet at all.

Question put, and agreed to.

Ordered,
That 60 much of Standing Order 91 as fixes Five as the quorum of the Select Committee on Standing Orders be road and suspended.

Ordered,
That, for the remainder of the Session, Three be the quorum of the Committee.

Oral Answers to Questions — INDIA.

MEDICAL DEGREES (RECOGNITION).

Mr. FREEMAN: 2.
asked the Secretary of State for India whether he is in a position to make any statement with regard to the question of the recognition by the General Medical Council of Indian medical degrees; and whether any settlement has been reached?

The SECRETARY of STATE for INDIA (Mr. Wedgwood Benn): The present intention of the Government of India is to establish an all-India Medical Council which will regulate the recognition of medical qualifications in India. I explained the position in regard to this subject on 18th June in reply to my hon. and gallant Friend the Member for South Derbyshire (Major Pole).

Dr. VERNON DAVIES: Will the right hon. Gentleman say how any decision of the Indian Government to consider the formation of an Indian Medical Council can possibly help Indian gentlemen who may desire to practise in this country?

Mr. BENN: I should require notice with regard to special points.

Dr. MORRIS-JONES: Has the right hon. Gentleman been in negotiation with the General Medical Council on this matter?

Mr. BENN: The whole matter arose in connection with the General Medical Council.

LEAGUE AGAINST IMPERIALISM.

Sir KINGSLEY WOOD: 3.
asked the Secretary of State for India whether his attention has been called to the special meeting of the League against Imperialism held recently in Berlin to organise international support for the great Indian struggle for emancipation; whether he has received an application from the league to permit Mr. J. R. Campbell and Mr. R. Bridgeman, as members of a delegation of the league, to proceed to India; and whether he will state the nature and terms of his reply to such application?

Mr. BENN: The answer to the first, two parts of the question is in the affirmative. As regards the last part, my reply was that I was unable to recommend the grant of passport facilities for the journey to India to the members of the proposed delegation.

BRITISH IMPORTS AND EXPORTS.

Mr. FREEMAN: 4.
asked the Secretary of State for India whether he can give any figures showing the reduction of British imports and exports to and from India this year?

Mr. BENN: The latest complete figures available are those for the three months January to March, 1930. These show a reduction of 14 per cent. in the value of imports from India into the United Kingdom and a reduction of 13 per cent. in the value of exports from the United Kingdom to India as compared with the corresponding three months of 1929. Figures are available up to the end of May which cover commodities representing about 70 per cent. of the total volume of trade. On these figures there is for
the three months March to May, 1930, a reduction of 14 per cent. in imports from India and a reduction of 21 per cent. in exports to India as compared with the corresponding three months of 1929.

Mr. WARDLAW-MILNE: While it may be the case that the fall in the exports to India is caused by other reasons, is it not the case that, imports into this country from India have declined in proportion to the imports into other countries of Europe from India during the same period?

Mr. BENN: That may be so, but I would like to look at the figures again before giving a precise answer.

Sir W. LANE MITCHELL: Is it not a question of the depreciation of values?

Mr. BENN: The values are the figures that I have taken.

Mr. BROCKWAY: In view of the condition of unemployment in this country, is it not desirable to reach some settlement with the Indian people which would enable us to trade with them to a larger extent?

Mr. BENN: It is highly desirable.

Earl WINTERTON: The right hon. Gentleman does not imply, by his reply to the hon. Member for East Leyton (Mr. Brockway), that this decline in trade is wholly or primarily due to political conditions? Is it not also due to world trade depression?

CONFERENCE.

Mr. FREEMAN: 5.
asked the Secretary of State for India whether a conference is to be summoned in India of selected leaders of various parties to consider the present situation?

Mr. BENN: I am not quite clear to what my hon. Friend refers, but the Viceroy is of course in touch with leaders of various Indian parties.

Mr. FREEMAN: Is not the time opportune to call a special conference so as to prevent an even more serious crisis arising?

Mr. BENN: The Viceroy, no doubt, has all these matters in mind.

Mr. BROCKWAY: Is it not a fact that the most representative leaders are in prison?

NORTH-WEST FRONTIER PROVINCE (CASUALTIES).

Earl WINTERTON: 8.
asked the Secretary of State for India why the names of the British other ranks, who were killed in the recent military operations in the North-West Frontier Province, were not officially published until several days after their deaths had occurred, although statements that there had been casualties appeared in the Press on the day following the operations?

Mr. BENN: I understand that the next of kin were officially informed immediately. Publication is another matter and if the Noble Lord desires, I will examine it.

Earl WINTERTON: Why has the practice been departed from, when casualties occur in any part of the Empire, of publishing the names of the casualties as soon as possible?

Mr. BENN: The Noble Lord will observe that, in order to save pain to the relatives, it is very desirable that the private information should be given before publication.

SUBVERSIVE PROPAGANDA.

Earl WINTERTON: 9.
asked the Secretary of State for India if he has now received further information from the Government of India in regard to the Communist propaganda in the North-West Frontier Province which was mentioned in an official communiqué in May?

Mr. BENN: Yes, Sir. The further information which I have received confirms the statements that I have previously made, namely, that though some of the agitation and disturbances in the North-West Frontier Province had certain of the characteristics of Communist organisation there is no evidence that they were directly due to the efforts of Communist agents or agencies from outside India. The Red Shirts' organisation which is affiliated to Abdul Ghaffar Khan's Youth League, is reported to be of indigenous growth and its objects, though largely political, are also partly social and religious. Its use of red uniforms and Communist emblems is probably imitative rather than directly inspired, and I have no proof of any financial support for the organisation coming from Russia.

Brigadier-General CLIFTON BROWN: 13.
asked the Secretary of State for India whether any steps have been taken to stop the distribution of revolutionary literature among the tribes on the Indian border; from what source does it come; and whether he is aware that pamphlets inciting Indians against British rule with the crest of the hammer and sickle on them have been recently found at Peshawar, Rawal Pindi and other military centres in the north of India?

Mr. BENN: Such literature has been distributed, and appropriate action has been taken by ordinance and otherwise to deal with the matter.

Brigadier-General BROWN: Can the right hon. Gentleman say what steps have been taken to find out from what source this literature has come?

Mr. BENN: All the information on this topic has been given to the House of Commons, as it has been received, in answer to questions.

BENGAL (GOVERNMENT OFFICERS).

Mr. TINNE: 10.
asked the Secretary of State for India why the first assistant secretary to the Government of Bengal has been refused the benefits of the recommendations of the Lee Commission's Report on the grounds of his appointment having been made in India, and his appointment being one in which his successor could be an Asiatic, when these benefits were conceded to the late registrar of joint stock companies, Bengal, the principal of the Law College, Madras, and the deputy registrar of the high Court; and why these benefits are accorded to the superintendent of Government printing in Bengal and denied to the lawyer who drafts the Acts and ordinances which he prints?

Mr. BENN: If the hon. Gentleman will allow it, I will circulate the answer to his question, as points of detail are involved.

Following is the answer:

It was decided in 1926 that the first assistant secretary in the Legislative Department of the Government of Bengal should not be eligible for these concessions, because his pay had recently been increased and it was not essential that the holder of the post should possess a non-Asiatic domicile.

Deputy registrars of the high courts do not appear to have received any of these concessions; their grant to the principal of the Law College, Madras, was personal to the then incumbent; while they were given to the late registrar of joint stock companies and the superintendent of Government printing in Bengal because special qualifications were required in the one case and special responsibilities existed in the other.

DISTURBANCES, BOMBAY.

Colonel HOWARD-BURY: 11.
asked the Secretary of State for India whether, owing to the increasing lawlessness in Bombay, any special measures are being taken to maintain law and order; and whether there are sufficient troops in Bombay for that purpose?

Mr. BENN: Emergency measures, the nature and necessity of which I have explained to the House, have been taken in recent months in Bombay. I have no reason to suppose that the local Government is unable to control the situation.

Colonel HOWARD-BURY: Is the right hon. Gentleman aware that lawlessness is increasing in Bombay, and is he satisfied that there are sufficient troops there to keep law and order?

Mr. W. J. BROWN: In view of the fact that lawlessness is increasing in India, in spite of all the precautions that are being taken to prevent it, does not the right hon. Gentleman think that a change in Governmental policy would be of much more importance?

Colonel HOWARD-BURY: May I have an answer to my supplementary question?

Mr. SPEAKER: The Secretary of State has already answered the hon. and gallant Member's supplementary question in his reply to the question on the Paper.

ROYAL INDIAN MARINE.

Mr. THURTLE: 12.
asked the Secretary of State for India what measures of Indianisation are being introduced in the commissioned and warrant ranks of the Royal Indian Marine now that it has been reorganised on a combatant basis?

Mr. BENN: Indians have not in the past been debarred from commissioned rank in the Royal Indian Marine, but
until recently Indian candidates have not been forthcoming. Special steps have now been taken for the recruitment and training of young Indians, and it is hoped that henceforth it will be possible to appoint Indians in one-third of the vacancies for executive and engineer officers. It is intended also to replace the European boatswains as they retire by Indians selected from qualified and suitable deck ratings, as soon as ratings are available with the necessary qualifications. Similarly, arrangements are being made to train suitable Indians as wireless operators to replace the civilian operators who have hitherto been obtained on loan for limited periods from the Indian Posts and Telegraphs Department. While this process of training is necessary, it will be supervised by ex-petty officer telegraphists whom it is hoped to obtain from the Royal Navy. In future, also, warrant writers and writers will be recruited solely from Indians, Anglo-Indians and members of the domiciled community in India.

Earl WINTERTON: Is the right hon. Gentleman satisfied that this Act which was so hotly opposed by the party opposite, is working very satisfactorily and carrying out the promises which were given to India?

Mr. BENN: As to the Act itself, it is quite irrelevant. I have given a very full answer to the question on the Paper.

Earl WINTERTON: Is the right hon. Gentleman satisfied that the procedure——

Mr. SPEAKER: General Clifton Brown.

FRONTIER TROOPS.

Brigadier-General BROWN: 14.
asked the Secretary of State for India whether he is satisfied that there are enough troops on the Indian frontier to deal with the situation; and whether arrangements have been made for British reinforcements in the event of further risings among the Afridi and Mohmand tribes?

Mr. BENN: Yes, Sir.

STATUTORY COMMISSION'S REPORT.

Mr. ERNEST BROWN: 15.
asked the Secretary of State for India what was the original estimate of the number of copies of the Royal Commission's Report which would be available in India; how many copies were in fact ordered
for India; if copies are now procurable; whether additional orders have been given; and, if so, for how many copies?

Mr. BENN: The Government of India originally estimated the number of copies of the Commission's Report required for India at 7,000 of each volume. This number of copies was despatched. In the case of Volume I, 3,000 copies should have been available for distribution about 14th June, apart from the copies made available to the Press on the day of publication and the remainder by the end of this week. In the case of Volume II, apart again from advance copies for the Press, 3,000 copies should be available for distribution by the end of, this week, and the remainder by about 11th July. In addition, arrangements have been made to despatch this week and next week 7,000 further copies of Volume I and 13,000 further copies of Volume II for sale in India.

Mr. BROWN: Does not the right hon. Gentleman think, in view of the value of and interest in this great Report, that 7,000 copies is a meagre estimate for 300,000,000 souls? [Interruption.]

Mr. BENN: These figures were arrived at after consultation, and I have no doubt that, if more copies are required, they will be forthcoming.

Mr. BROWN: Is not 7,000 copies a ridiculously small estimate, even taking into account all the illiteracy there? Surely, 7,000 copies is a ridiculous number, even for the Europeans in India who would desire to read this great Report?

Mr. BENN: If the hon. Member will read my answer, he will find that I have said that supplementary demands are to be met by supplementary supplies.

Mr. BROWN: Is not this a matter of great Empires and little minds?

Sir TUDOR WALTERS: Will the right hon. Gentleman consider the translation of this Report into different European languages?

Mr. BENN: There is a further question on that point.

Mr. HORE-BELISHA: Can the right hon. Gentleman say who pays for the copies ordered for India? Are they
being ordered by the Indian Government, or do they collect the money for them?

Mr. BENN: I shall be glad to give the hon. Member those particulars if he will be so kind as to put a question on the Paper.

Lieut.-Commander KENWORTHY: 19.
asked the Secretary of State for India what steps have been taken to arrange for the translation of the Report of the Indian Statutory Commission into foreign languages; and whether arrangements are being made for a larger edition of Part II of the Report than was provided of Part I?

Mr. BENN: As regards the first part of the question, the matter is under consideration. The answer to the second part is yes.

Lieut.-Commander KENWORTHY: With regard to the answer to the first part of the question, as to translation, could my right hon. Friend say if it is proposed to translate Parts I and II of the report into any of the indigenous languages of India—Hindu and so on?

Mr. BENN: I cannot say; the matter has not got past the preliminary stages of consideration.

Lieut.-Commander KENWORTHY: Will my right hon. Friend consider the fact that there are two questions, the one regarding translation into European languages, Japanese, and so on, and the other the necessity of translating the report into the leading Indian languages?

Mr. BENN: Yes, Sir.

Sir AUSTEN CHAMBERLAIN: Can the right hon. Gentleman say anything about the taking of any steps to circulate Volumes I and II of the English edition of the report in the United States of America?

Mr. BENN: I shall be glad to make inquiries and to give the right hon. Gentleman the information when I receive it.

Mr. ARTHUR MICHAEL SAMUEL: May I ask the right hon. Gentleman not to allow the question of expense to stand in the way, but to regard it as quite a secondary matter?

MEDICAL SERVICE, CHAKRATA.

Mr. DAY: 16.
asked the Secretary of State for India whether he will give particulars of the improvements that have been made during the previous 18 months in the medical service at Chakrata United Province; the number of soldiers' wives and children for whose health the Royal Army Medical Corps are responsible at this station during the hot season; and is he satisfied that the hospital in this particular district is now properly staffed both in regard to doctors and nursing sisters?

Mr. BENN: As the result of an inquiry held in India in September, 1928, to investigate certain complaints with regard to medical treatment and arrangements at Chakrata, the Government of India made changes in the medical staff and provided a permanent increase in the nursing staff during the summer months. They were satisfied that these measures would prove adequate, and I have had no reason to question their conclusion. I could not answer the second part of the question without reference to India.

Mr. DAY: Can the right hon. Gentleman say whether the present medical officers there have any knowledge of Eastern diseases?

Mr. BENN: I should imagine so, but perhaps my hon. Friend would put that question down.

Mr. DAY: Was not that one of the complaints previously?

Mr. BENN: I have explained to my hon. Friend that that complaint was investigated two years ago, and satisfactory measures were taken to put things right.

PUBLIC MEETINGS (GOVERNMENT SERVANTS).

Mr. LONGDEN: 17.
asked the Secretary of State for India whether the Government of India and/or the provincial government have issued orders warning Government servants against attending public meetings; and, if so, what are the terms of such orders?

Mr. BENN: I have no information on this specific point, but the conduct of civil servants in India is governed by rules comparable to those in force in this country.

FOREIGN CLOTH (BOVCOTT).

Mr. LONGDEN: 18.
asked the Secretary of State for India whether he has received information of orders which have been issued in India, under Section 144 of the Criminal Procedure Code, prohibiting the holding of any meeting for the boycott of foreign cloth; and, if so, whether he will recommend to the Government of India the desirability of revoking such orders?

Mr. BENN: I have no official information on the point raised, but, if my hon. Friend desires, I will make inquiries. I should add that Section 144 has no relation to boycott, but is of general application when danger is apprehended, and is made operative on the decision of the district magistrate empowered by the local government.

Mr. FREEMAN: Can my right hon. Friend say whether the boycott of foreign cloth is illegal, or only intimidation against those using foreign cloth?

Mr. BENN: The operation of Section 144 is described in the Section, and, if I send my hon. Friend a copy of it, I think that that will clear up the doubts in his mind.

Mr. FREEMAN: Cannot my right hon. Friend say whether the boycott of foreign cloth is illegal in itself?

Mr. BENN: I think that legal questions, to one who is not a lawyer, should be put on the Paper.

LEGISLATIVE ASSEMBLY (RESIGNATIONS).

Mr. MARLEY: 20.
asked the Secretary of State for India whether any and, if so, what resignations from the Legislative Assembly have taken place since 1st April, 1930; whether the reasons for such resignations were stated; and, if so, what were they?

Mr. BENN: Twenty-four elected members of the Legislative Assembly have resigned since 1st April. Two gave no reason for their resignation; 10 resigned as a protest against the passing of the Cotton Textile Industry Protection Act; eight as a protest against the action taken by Government to deal with the civil disobedience campaign; and two in order to join that campaign. Two Europeans resigned owing to absence in Europe.

BOMBAY GOVERNMENT (NEWSPAPER CRITICISM).

Mr. MARLEY: 21.
asked the Secretary of State for India whether his attention has been called to a letter dated 23rd May, 1930, issued by the Brigadier-General Staff, Southern Command, India, endorsing a leading article appearing in the "Poona Star," dated 22nd May, 1930, criticising the Bombay Government; and if so, whether he proposes to take any action, in view of the irregularity of this conduct, which is contrary to the King's Regulations?

Mr. BENN: I fear I know nothing of this matter; but, if my hon. Friend will let me have particulars, I will examine the case.

Mr. MARLEY: Has it not been published all over the country? Has the right hon. Gentleman seen the article in the "Poona Star," and the letter, signed by Major Turner, regarding this matter?

Mr. BENN: I shall be grateful if my hon. Friend will supply me with those very particulars.

SITUATION.

Mr. WARDLAW-MILNE: 22.
asked the Secretary of State for India whether he will give the House the latest information he has as to the conditions in India?

Mr. BENN: I am circulating a statement giving an appreciation of the situation by the Government of India up to 21st June:

Following is the statement:

Appreciation of the situation by the Government of India up to 21st June, 1930.

North-Vest Frontier Province.—Tribal situation is improving but still gives cause for anxiety. Several arrests have been effected which furnish concrete evidence of statements made last week regarding propaganda amongst tribes. On Peshawar District border Utman Khel Lashkar has completely dispersed. This is result of air action taken, after due warning, on 10th-17th June, against Lashkar and against certain villages from which contingents came, and of action by troops who, on 19th June, moved out to neighbourhood of Pallai village, about one mile inside administrative border.
Only small remnants of Lashkar awaited arrival of troops. Pallai village and caves in which Lashkar had been sheltering found deserted. About 15 prisoners captured, together with some rifles. Casualties inflicted on Utman Khel estimated at about 20. Our troops had one man slightly wounded. Villagers have since returned to their homes and have undertaken not to admit hostile Utman Khel within their limits. Situation in this portion of district markedly better since expulsion of Lashkar. Mohmand hostiles on Shabkadr side have not yet dispersed and continue to receive reinforcements in small numbers. Air action has been kept up against them as occasion offered. Afridi Jirga at Bagh on 13th June was well attended by young hot-heads of tribe, who refused to admit Maliks and Elders to Jirga. It was decided in first place to ascertain real causes of previous week's failure and to leave future course of action for decision on 20th or 27th June. Results of Jirga on 20th not yet known, but communication between Tirah and malcontents in Peshawar is believed to be active, and hostiles busy with attempts to arrange cessation of private feuds in Tirah with view to combined action against Government. Agitation amongst Jowakis and Hassan Khel Afridis at one time assumed threatening appearance, but steadier attitude of Pass Afridis has brought them back to reason. Orakzai tribes generally quiet but are sending representatives to Bagh Jirga.

Internal situation generally better, but agitators still at work and meetings held at various centres. In Bannu some Bizan Khel Wazirs from tribal territory appeared for first time as picketers and were arrested. Efforts by some Bannuchis to hold meeting in Mohmand Khel Wazir limits (tribal territory) were unsuccessful owing to refusal of Mohmand Khel Maliks, and meeting had to be transferred to neighbouring Bannuchi village inside district. Gathering did not, however, exceed 700, of whom 300 were Bakka and Jani Khel Wazirs from tribal territory. Deterioration of situation in Swabi Tahsil of Peshawar district necessitated despatch of small column to various villages and arrest, without incident, of selected leaders of agitation. Charsadda. — Situation greatly improved. Elsewhere nothing to report.

There have been no serious disturbances during the week, but information has been received of events in several districts which show that Congress leaders are unable to control local organisations and that trend of movement as whole is towards violence. Detailed reports have been received regarding series of disorders which have taken place during past few weeks in various parts of Midnapore district. They leave no doubt that these were organised by Congress volunteers inspired from Calcutta and that widespread attempts were made, with considerable temporary and local success, to pervert countryside. Rumour current over a large area was that British Raj had come to end, and first manifestations of this belief were attacks on small parties of police who had visited villages in discharge of their duties. These were instigated and organised by Congress volunteers, and in several cases were of a determined and savage character. One of these attacks was accompanied by murder of Sub-Inspector of Police. Other activities of volunteers include incitement to nonpayment of Chaukidari tax. The situation in this district has been brought under control and adequate force of additional police is being stationed in affected areas at cost of inhabitants. Similar situation, but of less serious character, threatened to develop in part of Bhagalpore district in Bihar and Orissa. Congress volunteers set up camp in area notorious for its spirit of lawlessness. Regular barracks were erected where volunteers drilled and practised lathi play. Early in month camp was seized by police without difficulty, but subsequently large crowds assembled which consisted, not only of sightseers, but of persons armed with staves who had been collected by volunteers from neighbouring villages. It has been necessary to disperse crowds on several occasions, but considerable area is disturbed and reinforcements of police have been sent there. In same province small party of police was attacked by some villagers belonging to aboriginal tribes. Bombay Government reports several organised attacks by tribe of criminal tendencies on Muhammadans and others including village servants, in Kaira district of Gujerat. There is said to be unmistakeable evidence that this tribe is being incited by prominent adherents of
civil disobedience movement in Gujerat to stir up trouble. Above instances of trouble in rural areas must not be interpreted as indicating any serious extension of civil disobedience movement outside towns. They must be regarded rather as illustrating methods pursued by local Congress organisations and consequences that are likely to result.

Campaign for non-payment of taxes does not in fact appear to be making progress and, except in Gujerat, it has nowhere succeeded in obtaining firm footing. Picketing of foreign cloth and liquor shops has intensified in some places during week. In Bombay City European shops have been picketed with deliberate intention of defying authorities, and arrest of picketers has been accompanied by demonstrations necessitating dispersal of crowds on several occasions. Picketing of liquor shops in rural areas has on several occasions been accompanied by violence on part both of picketers and of those picketed. Bihar and Orissa reports numerous cases of riot, trespass and assault in this connection.

Marked feature of week has been increase of activities designed to seduce troops and police from their loyalty. Attempts of this kind have been carried on for some time on organised scale, but reports from several provinces show that new methods are being adopted and that special attention is being devoted to this part of the civil disobedience programme. So far as police are concerned weapon of social- boycott is also being used in many places in hope that this will compel resignations. Neither methods of persuasion nor of compulsion have had effect. In Punjab revolutionary party has put into operation a new plan, object of which appears to have been to terrorise police by organised outrages on large scale. Scheme was briefly to explode bomb in rented house or serai and to arrange for second bomb to explode some time later, interval between two explosions being so calculated as to cover arrival of party of investigating police, who would, in ordinary course of their duty, proceed to place on receipt of news of first explosion. In early morning of 19th this plan was put into execution in no less than six towns of Punjab. Fortunately it failed in four places, but in remaining two, police suffered injuries which were serious in the case of
an inspector and constable. Previous to this there had been six or seven sporadic explosions in Punjab during past month or two, and there are indications that terrorist outrages are likely to increase. This was to be expected, for comparative lull in revolutionary activity probably represented nothing more than temporary quiescence pending results of civil disobedience movement. As latter fails to achieve its objects, extremists are likely to resort to methods of terrorisation.

Mention has been made in appreciation of past few weeks of mobilisation of sane and loyal opinion against civil disobedience movement. This continues to gain strength. Punjab Government, for instance, report that opposition to Congress programme is increasing in vigour and effectiveness, and that they have been inundated with resolutions of loyalty and assurance of help from all communities, including Hindu organisations. Similar reports of loyal offers have been received from elsewhere.

PRISONERS.

Mr. FREEMAN (for Mr. MARDYJONES): 1.
asked the Secretary of State for India if he can now state what is the total number of members and ex-members of the Legislative Assembly who are now in gaol in connection with the nonviolence civil disobedience movement in India, together with the total number of members of provincial councils from each province now in gaol?

Mr. BENN: I have asked for figures as to the numbers of members and ex-members of the Assembly and Provincial Councils who have been sentenced, and I will supply them to my hon. Friend on their receipt from the Government of India.

Mr. WINTERTON (for Mr. MARDY-JONES): 6.
asked the Secretary of State for India whether the Government proposes to declare a general amnesty for all political prisoners in India now interned, after or without trial, as an act of grace preparatory to the summoning of the proposed round-table conference next autumn?

Mr. BENN: In the present circumstances, I fear this suggestion cannot be entertained.

Mr. CHURCHILL: Not a single syllable of that answer was audible in any part of the House. May we know what the answer was?

Mr. BENN: In the present circumstances, I fear this suggestion cannot be entertained.

Oral Answers to Questions — MEXICO (BRITISH BONDHOLDERS).

Mr. A. M. SAMUEL: 23.
asked the Secretary of State for Foreign Affairs whether he is aware that the Mexican Finance Minister, Luis Montes de Oca, is attending a conference in New York for the purpose of dealing with the Mexican external debt; and will he request His Majesty's Ambassador in the United States of America to inquire of the Mexican Minister what steps the Mexican Government proposes to take in respect of its default since 1914 in its obligations to British holders of Mexican Government securities?

The SECRETARY of STATE for FOREIGN AFFAIRS (Mr. Arthur Henderson): Yes, Sir. The International Committee of Bankers on Mexico have announced that the Secretary of the Mexican Treasury will arrive in New York on 25th June to discuss with them both the external debt of the Mexican Government and the debt of the National Railways. Delegates of the British section of the Committee will be present at the discussions. As I have frequently stated in this House, the International Committee of Bankers are the properly qualified agents of the bondholders, and are authorised to carry on negotiations on their behalf with the Mexican Government. In these circumstances, I do not consider that any useful purpose would be served by instructing His Majesty's Ambassador in Washington to intervene.

Mr. SAMUEL: Will the right bon. Gentleman notify His Majesty's Ambassador at Washington that Mexico is now very prosperous and that British subjects have been deprived of £150,000,000 in the last 16 years?

Mr. HENDERSON: I do not think it is necessary. The British representative on the Commission will be present.

Mr. SAMUEL: Is the right hon. Gentleman not aware that, after three years' conversations, we have not arrived at an alleviation of the situation?

Mr. HENDERSON: As the hon. Gentleman has admitted that the matter has been standing over for so many years, surely he ought to be satisfied that we have got a move on.

Oral Answers to Questions — MALTA.

Captain PETER MACDONALD: 24.
asked the Secretary of State for Foreign Affairs whether, in view of the importance of the issues raised by the recent controversy in Malta, he will arrange for the publication of further documents not included in the recent Blue Book, such as the draft concordat between the Maltese Government and the Vatican, the correspondence between the Maltese Ministry and the Vatican on the claim of the Vatican that clerics can only be brought into Court with the consent of their ecclesiastical superiors, and the reply of Lord Strickland to the detailed charges brought against him by the Vatican and included in the Blue Book?

Mr. A. HENDERSON: No, Sir. I do not at present propose to publish any correspondence or documents supplementary to those contained in the Blue Book. The first two categories referred to by the hon. and gallant Member have, however, already been published in the Malta Government Gazette. With regard to the third category, His Majesty's Government have never been called upon to intervene in this particular dispute. Still less have they ever made it the subject of representations to the Vatican. For these reasons I do not consider that they could properly agree to its publication.

Captain CAZALET: Has the right hon. Gentleman taken any decision as to appointing a Minister to the Vatican?

Mr. HENDERSON: No, I have not taken any decision, and I do not propose to be in a hurry to do so.

Mr. LEIF JONES: Will the report of Monsignor Robinson which is referred to in the Blue Book and which is published in the Vatican White Paper be made accessible to Members of Parliament?

Mr. HENDERSON: I must have notice of that question.

Several HON. MEMBERS: rose
——

Mr. SPEAKER: Any further questions should be put on the Paper.

Oral Answers to Questions — DEAD SEA SALTS (CONCESSIONS).

Colonel HOWARD-BURY: 26.
asked the Secretary of State for Foreign Affairs whether he has had any further communications from the French Government with regard to the Dead Sea concessions; and whether the question will now be referred to arbitration at The Hague?

Mr. A. HENDERSON: The French Ambassador has recently mentioned the matter. As regards the second part of the question, I regret that I am not yet able to give a definite reply. The question of submitting the matter to arbitration is under active consideration by His Majesty's Government.

Colonel HOWARD-BURY: Can the right hon. Gentleman say when he will be in a position to answer further questions on the subject?

Mr. HENDERSON: I am afraid I cannot. There are other Departments involved. I hope the hon. and gallant Gentleman will allow the matter to stand over.

Oral Answers to Questions — TRADE AND COMMERCE.

PORTUGUESE PORTS (FLAG DISCRIMINATION).

Lieut.-Colonel Sir A. LAMBERT WARD: 27.
asked the Secretary of State for Foreign Affairs whether his attention has been called to the action of the Portuguese Government in differentiating against British shipping; and whether he intends to make further representations in the matter?

Mr. A. HENDERSON: As I stated in my reply to the hon. Member for Fain-ham (Mr. A. M. Samuel) on 26th March, His Majesty's Ambassador at Lisbon was instructed in February last to address urgent representations to the Portuguese Government on the subject. The Portuguese Government have recently replied to the effect that they are considering the whole question of flag discrimination, and that they will give full consideration to the views of His Majesty's Government. His Majesty's Government will
not fail to continue to press the Portuguese Government to modify the present system, which is so detrimental to British interests.

Sir A. LAMBERT WARD: Will the right hon. Gentleman consider the advisability of denouncing the commercial treaty which confers on Portugal the sole right of the sale of port wine in this country if the Portuguese Government do not see their way to give fair treatment to our shipping?

Mr. HENDERSON: I must have notice of that question.

Mr. A. M. SAMUEL: Is the right hon. Gentleman aware that chambers of commerce have for some months past been protesting against this discrimination, and will he suggest to the Portuguese Government that it is within our power to double the duty on their wines?

Mr. HENDERSON: I have stated that we are continuing to press the matter on the Portuguese Government.

Lieut.-Commander KENWORTHY: The matter has been going on for some five years. Is there any other pressure which we can bring, even if the suggestion of the hon. Gentleman opposite is not taken?

EXHIBITIONS.

Mr. DOUGLAS HACKING: 34.
asked the Secretary to the Overseas Trade Department when he expects to receive a report from the Chelmsford Committee in connection with the future policy of his Department regarding trade exhibitions?

Mr. GILLETT (Secretary, Overseas Trade Department): The Committee expects to finish taking evidence before the Summer Recess, and it is anticipated that the report will appear in the autumn.

Mr. HACKING: Do I take it that the arrangements for next year's British Industries Fair will not be held up for the report of the Chelmsford Committee?

Mr. GILLETT: No. The recommendations of the Committee will not affect next year's Fair.

Mr. HACKING: 35.
asked the Secretary to the Overseas Trade Department how many of the signatory Governments have declared their intention to ratify the Con-
vention relating to international exhibitions, signed in Paris in November, 1928?

Mr. WOMERSLEY: 39.
asked the Secretary to the Overseas Trade Department how many, if any, countries have ratified the Convention of Paris of 22nd November, 1928, on the control of international exhibitions; and what is the position of His Majesty's Government in the matter?

Mr. GILLETT: The British, French and German Governments have notified their intention to ratify the Convention, and the Swedish Riksdag have passed a Bill authorising ratification.

Mr. HACKING: 36.
asked the Secretary to the Overseas Trade Department whether he can make any statement regarding the results being achieved at the British section of the Antwerp Exhibition?

Mr. GILLETT: The British Pavilion and exhibits have received many friendly and eulogistic references in the British and Belgian Press. Private reports from exhibitors indicate that they are very well satisfied with the results so far obtained. It is estimated that well over 1,000,000 people have visited the exhibition, of whom at least 1,000,000 have passed through the British Pavilion.

Lieut.-Commander KENWORTHY: Is the hon. Gentleman aware that the British section was one of the only two principal exhibits ready on the opening day when I was there?

Mr. HANNON: 37.
asked the Secretary to the Overseas Trade Department whether he can now indicate the nature and extent of the organisation in progress in connection with the projected British trade exhibition at Buenos Ayres in March and April of next year; and if he is satisfied that everything possible is being done to secure the success of this undertaking?

Mr. GILLETT: Since I answered the question by the hon. Member for Willesden East (Mr. D. G. Somerville) on this subject on 26th May, the number of applications from British firms wishing to exhibit has so increased that it has proved necessary to provide a further 100,000 square feet, making nearly 250,000 square feet in all of covered space. In reply to the latter part of the question,
I am endeavouring to see that everything possible is being done to secure the success of the exhibition.

MEXICO.

Mr. HANNON: 38.
asked the Secretary to the Overseas Trade Department whether any special effort is being made by his Department to develop British trade in Mexico, which is now in a comparatively prosperous condition, and the percentage of Mexican imports which have been supplied by the United States, Germany, and Great Britain in the year 1929?

Mr. GILLETT: My Department has recently called for special reports for circulation to British firms, on the market in Mexico for commodities in which the United Kingdom is in a position to compete. In December last it co-operated with the aircraft industry in sending a special representative to Mexico City for the Mexico aviation week with the object of bringing the qualities of British aircraft and aircraft material to the notice of the Mexican aviation authorities both civil and military. As regards the second part of the question, the latest figures published are those for 1928, in which year the percentages of Mexican imports supplied by the United States, Germany and Great Britain were respectively 67.5, 9.1 and 7.3.

Mr. HANNON: Will the hon. Gentleman tell the House who at the moment is in charge of the commercial interests of this country?

Mr. GILLETT: We have a Consul in Mexico, but no commercial representative.

SUGAR INDUSTRY (EXPORT CREDITS SCHEME).

Mr. HURD: 40.
asked the Secretary to the Overseas Trade Department whether it is proposed to extend British Government credit for the sale of Cuban sugar to the Russian Soviet Government, and what are the details of the proposal; and whether any similar use of British credit is being made for the benefit of the distressed sugar-growing Colonies of the British Empire?

Captain P. MACDONALD: 41.
asked the Secretary to the Overseas Trade Department whether a credit has recently been
granted under the export credits system to enable a transaction to be completed with the Soviet Government in respect of a purchase of sugar; and, if so, whether he can state upon what terms the business was completed?

Captain GUNSTON: 42.
asked the Secretary to the Overseas Trade Department whether, in any further guarantees which he may authorise in connection with the export credits scheme regarding the exportation of sugar to foreign countries, he will insist that only sugar grown within the Empire and refined in Great Britain should receive the benefit of the scheme?

Mr. GILLETT: It is not the practice to give particulars of individual transactions carried out with the assistance of the Export Credits Guarantee Scheme, but facilities have been given in connection with the export to Russia of sugar refined in this country. The object of the scheme being to assist British exporters, no conditions as to the origin of the raw sugar employed are made.

Mr. HURD: Do I understand that it is a fact that any proposal affecting the sugar colonies in the West Indies will receive at least equal treatment?

Mr. GILLETT: Yes, Sir. The Committee will always give any proposals that are in order the most careful attention.

Mr. R. A. TAYLOR: Is not the Advisory Committee thoroughly representative of the Conservative party?

Captain MACDONALD: In view of the condition of the West Indian sugar industry, and the need of every assistance being given to it at the present time, is it not advisable that the present Government should insist that only British sugar should be exported under this credit scheme?

Mr. GILLETT: It is very difficult for the Advisory Committee to impose terms of that kind. Naturally, they would only be too pleased to support proposals put before them on the lines suggested by the hon. Member, but I believe that it would be quite impossible to make it an absolute condition.

Mr. A. M. SAMUEL: Will the hon. Member request the Advisory Committee to see that His Majesty's Government are
not guarantors of Soviet paper to such an extent as will hamper our policy when the inevitable break arises?

IRON AND STEEL INDUSTRY.

Mr. A. M. SAMUEL: 61.
asked the President of the Board of Trade the number of furnaces in blast as at 1st June, 1930, and the number as at 1st April, 1930; and will he also give the monthly average production of pig-iron for the year 1913 and the monthly average for the first five months of 1930?

The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Mr. W. R. Smith): As reported by the National Federation of Iron and Steel Manufacturers, the number of furnaces in blast in the United Kingdom was 141 at the end of May, 1930, and 157 at the end of March, 1930; the production of pig-iron averaged 855,000 tons monthly in 1913 and 631,400 tons monthly in the first five months of 1930.

Mr. SAMUEL: Do not these facts reflect that we have imported 3,000,000 tons of iron and steel in the last 12 months?

Mr. SMITH: I do not know whether that is the case or not.

Oral Answers to Questions — CHINA (CHILD LABOUR).

Mr. L'ESTRANGE MALONE: 28.
asked the Secretary of State for Foreign Affairs whether any regulations exist for the prohibition of child labour in the British factories in the settlements and concessions in China?

Mr. A. HENDERSON: I regret that there are no regulations relating to child labour in any factories anywhere in China. There are serious objections to dealing with the matter by means of British legislation. I hope that the difficulty may in time be overcome by the enactment of Chinese legislation which it will be possible to enforce uniformly in both Chinese and foreign factories.

Mr. MALONE: Will the right hon. Gentleman consider, in view of the serious effect on trade in Lancashire, the despatch of an experienced factory inspector to report on the matter?

Mr. HENDERSON: I must have notice of that question.

Oral Answers to Questions — POLAND.

Mr. MALONE: 29.
asked the Secretary of State for Foreign Affairs whether he has any information as to the result of the two petitions submitted to the League of Nations by the Ukrainian minority in Poland, namely, that dated 15th January, 1929, concerning the liquidation of Ukrainian elementary schools, and that dated 2nd March, 1929, regarding the abolition of autonomous administration?

Mr. A. HENDERSON: No, Sir. I have not yet received either, of these petitions, which were not examined during the recent session of the Council of the League of Nations.

Mr. MALONE: Will the right hon. Gentleman call for a report on the result of these two petitions and, further, as to why nearly two years have elapsed since they were first presented?

Mr. HENDERSON: I will consider that matter.

Colonel WEDGWOOD: Have not the procedure and regulations in connection with these minority complaints now been altered, and is publicity not now involved?

Mr. HENDERSON: I must have notice of that question.

Oral Answers to Questions — RUSSIA (PROPAGANDA).

Sir WILLIAM DAVISON: 30.
asked the Secretary of State for Foreign Affairs whether the special committee dealing with Soviet propaganda have now considered the Report of the Sixth Congress of the Communist International, which was recently published by the Soviet State publishing department in Moscow, giving particulars of the active part taken by agents of the Third International in fomenting unrest in India and elsewhere; and what action has been taken with regard to this official document?

Lieut.-Colonel Sir FREDERICK HALL: 32.
asked the Secretary of State for Foreign Affairs whether his attention has been called to the proceedings at the recent conference of the Communist party of the Moscow district and the central provinces; whether he is aware
that M. Kalinin, the president of the Union of Soviet Socialist Republics, was present at the conference and urged the delegates to further the efforts in support of the class-war movement now being carried on in India, in which the Communist organisation known as the Red Shirts were the chief agents; whether he has referred this matter to the special committee dealing with Soviet propaganda; and whether any action is contemplated in consequence?

Mr. A. HENDERSON: The alleged activities of the Comintern in India formed the subject of debates on 2nd June and 6th June, and I have at present nothing to add to the statements made on these occasions.

Sir W. DAVISON: Is the right hon. Gentleman aware that thousands of copies of this official document have been issued for many weeks, which is a direct breach of the pledge given by the Soviet Ambassador? Surely we ought to have some reason why no action has been taken.

Sir F. HALL: Does the right hon. Gentleman think the attitude that has been adopted by the President of the Soviet is in agreement with arrangements which have been made by the Socialist Government with Russia?

Mr. HENDERSON: These matters were the subject of a debate and official answers were given; I have nothing to add.

Sir F. HALL: Taking all matters into consideration, and the strong language used by the President of the Soviet, will the right hon. Gentleman undertake to make formal representations to the Soviet Government on the subject?

Mr. HENDERSON: I have already announced that the Government have set up appropriate machinery for dealing with the matter.

Sir F. HALL: In consequence of the unsatisfactory reply, I will raise the matter at the earliest opportunity on the Adjournment.

Sir W. DAVISON: 31.
asked the Secretary of State for Foreign Affairs what action has been taken as a result of the special machinery recently set up with re-
gard to the subsidisation by the Third International of the Daily Worker newspaper?

Sir K. WOOD: 33.
asked the Secretary of State for Foreign Affairs whether as a result of the inquiries of the special committee, he has discussed with the Soviet Ambassador the question of any variation in the terms of the Treaty with Soviet Russia, particularly as regards propaganda; and if he can make any statement as to the position and intentions of the Government in relation to this aspect of the treaty?

Mr. A. HENDERSON: I have nothing to acid to the statement made in the debate on the Adjournment on 6th June.

Sir W. DAVISON: As a result of his inquiries, can the right hon. Gentleman deny that this paper is subsidised directly by the Soviet Government?

Mr. HENDERSON: I cannot deny and I cannot confirm. I only want to find out.

Earl WINTERTON: In view of the fact that, on the occasion to which the right hon. Gentleman has referred constantly in his supplementary answers, he said he would make a definite statement at as early a date as possible, can he give us any indication when he will be in a position to make that statement?

Mr. HENDERSON: I am afraid I cannot at present.

Major the Marquess of TITCHFIELD: How much longer is the right hon. Gentleman going to cringe and fawn before the Bolshevists?

Oral Answers to Questions — AGRICULTURE.

WAGES REGULATION ACT (PROSECUTIONS).

Mr. DAY: 43.
asked the Minister of Agriculture the number of prosecutions instituted during the 12 months ended to the last convenient date against farmers who have failed to comply with the provisions of the Agricultural Wages (Regulation) Act, 1924, in respect of the non-payment of minimum rates of wages; and can he state the amount that has been awarded by the courts in arrears of wages?

The MINISTER of AGRICULTURE (Dr. Addison): During the 12 months ended 20th June, 1930, 164 employers were prosecuted for failing to pay wages at not less than the minimum rates fixed under the Agricultural Wages (Regulation) Act, 1924, and the Courts awarded arrears of wages amounting to £3,357.

Mr. DAY: Can my right hon. Friend say whether any proceedings have been brought against people refusing to give the necessary information to the investigating officer?

Dr. ADDISON: I am afraid that I should require notice of that question.

Mr. de ROTHSCHILD: Will the right hon. Gentleman tell the House when he proposes to do something for the farming industry to enable the farmer the better to pay those wages?

IRISH BULLS (SALES).

Brigadier-General BROWN: 44.
asked the Minister of Agriculture whether he is aware that bulls rejected in Ireland as scrub bulls unfit for breeding purposes are being sold in the cattle markets of this country; and whether he will initiate legislation to prevent all such bulls from being sold over here except for slaughter?

Dr. ADDISON: The reply to the first part of the question is in the affirmative. I am considering the practicability of taking legislative action which will deal not only with the rejected bulls from Ireland, but with the elimination of scrub bulls generally.

Colonel HOWARD-BURY: Does not that prove that the Irish Free State Minister of Agriculture looks after his industry?

Mr. HANNON: Will the right hon. Gentleman take every possible care to see that no unfair embargo is placed upon the importation of Irish bulls into this country?

Brigadier-General BROWN: Is it not a fact that some of these Irish bulls which have been rejected over there with the mark on have had the tab taken out of their ears and been sold in these markets, and the farmers have not understood that they have been rejected?

POLITICAL PARTIES (CONFERENCE).

Mr. LAMBERT: 45.
asked the Prime Minister what progress has been made
with the composition of the non-party agricultural conference; and whether all questions germane to the agricultural industry are to be discussed and considered by the members of the conference?

The PRIME MINISTER (Mr. Ramsay MacDonald): As I have already stated, I have received a favourable reply from the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George); and I have received over the week-end a negative reply from the right hon. Gentleman the Leader of the Opposition. It was my intention to bring under review, had the consultations taken place, all questions germane to the agricultural industry.

Sir F. HALL: And for us to take the responsibility out of your hands?

Lieut.-Commander KENWORTHY: Are we to understand that the conference is going on still with the two parties?

The PRIME MINISTER: The three-party conference is not going on, but the two-party conference will very likely go on.

Sir K. WOOD: Who will answer for this two-party conference? Will it be the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George)?

HON. MEMBERS: "Beaverbrook," and "Rothermere!"

FOREIGN PRODUCE (ASSISTED EXPORTS).

Mr. BUTLER: 53.
asked the Minister of Agriculture whether he can give the House any information about the shipments of subsidised French grain reaching British ports; and whether he proposes to take any steps to assist British produce in face of this competition?

Dr. ADDISON: My information is to the effect that the total imports of French wheat into the United Kingdom have shown a very marked rise during recent months. As regards the latter part of the question, I can add nothing at present to previous statements by myself and my predecessor on the subject.

Mr. BUTLER: Is the right hon. Gentleman aware that this is having a very deleterious effect upon the arable farmer, and can the arable farmer look to the present Government for any help in his very serious position at the present time?

Earl WINTERTON: Can the right hon. Gentleman say whether he has exact figures in regard to the first part of the question, and, if so, in view of the great importance of the subject to the agricultural districts, will he give the figures?

Dr. ADDISON: There are many figures, but I will give the Noble Lord the important ones. In the first five months of 1929 the flour imports were 63,000 cwts., and in the same period in 1930 627,000 cwts. Wheat has gone up from practically nil to 1,713,000 cwts.

MERCHANDISE MARKS ACT (BUTTER).

Sir WILLIAM WAYLAND: 54.
asked the Minister of Agriculture whether he is prepared to consider an application, under the Merchandise Marks Act, for an Order in Council applying to blended butter and to recommend the Government to promote legislation to deal effectively with those forms of misleading labelling of butter that cannot be dealt with under the Merchandise Marks Act?

Dr. ADDISON: This matter is receiving my careful consideration, and I hope to be able to inform the hon. Member of my conclusion at an early date.

WORKERS.

Mr. LAMBERT: 56.
asked the Minister of Agriculture whether any estimate has been prepared by his Department of the loss of agricultural labour caused by the withdrawal of over 1,000,000 acres from arable cultivation in England and Wales since 1913?

Dr. ADDISON: Comparable figures for the number of agricultural workers are not available for the year 1913. Since 1921, the number of workers has decreased by 99,000. During the same period the arable acreage has been reduced by 1,670,000 acres, but there are also many other factors operating.

Mr. GRANVILLE: Can the right hon. Gentleman say when he intends to extend unemployment insurance to the agricultural workers?

FERTILISERS AND FEEDING STUFFS ACT (PROSECUTIONS).

Lieut.-Colonel ACLAND-TROYTE: 57.
asked the Minister of Agriculture whether he has received complaints that limitation of the purchaser's powers under the Fertilisers and Feeding Stuffs
Act, 1926, in respect of samples taken after the goods have left the seller's premises, to civil remedies has proved ineffective and has failed to give adequate protection to the farmers; and whether he will consider amending the Act so as to restore to local authorities the power to take criminal proceedings in such cases?

Dr. ADDISON: I have received a resolution on this subject passed by one county council and supported by three others. I cannot agree that the Act has proved ineffective. An amendment of the nature indicated would be contrary to the unanimous recommendation of the Departmental Committee on whose report the Act was based.

Oral Answers to Questions — UNEMPLOYMENT.

ADMINISTRATION.

Sir K. WOOD: 47.
asked the Prime Minister which Minister will particularly deal with the relations of industry to the unemployment position and engage himself in the work previously carried on by the present Secretary of State for Dominion Affairs when he held the office of Lord Privy Seal?

The PRIME MINISTER: The late Lord Privy Seal will carry out the work he began in promoting the economic reorganisation of those industries which require this treatment. Otherwise questions dealing with unemployment will be answered as was done previously by the Departments concerned.

Mr. CHURCHILL: Has the Prime Minister been able to re-arrange the Governmental offices in such a manner, as he suggested, that no extra charge is thrown upon the public in salaries of Ministers?

Mr. SPEAKER: That does not arise out of the question.

CABINET COMMITTEE (STAFF).

Mr. GRANVILLE: 48.
asked the Prime Minister if it is his intention to appoint to the unemployment committee a civil servant from the Ministry of Agriculture to represent the position of English and Welsh farming?

50. Sir NICHOLAS GRATTAN-DOYLE: asked the Prime Minister the power and duties and composition of the organisa-
tion of civil servants which has now been established for the purpose of dealing with unemployment and of co-ordinating the experiences of departments thereon?

The PRIME MINISTER: I would refer the hon. Members to the statement which I made in the course of the debate on 18th June. A staff of civil servants, performing the ordinary functions of civil servants, has been appointed to work under the direction of the Unemployment Committee of the Cabinet. Full provision is being made for taking into effective consultation the separate departments concerned.

Sir HENRY BETTERTON: Are these full-time jobs, and will they be seconded?

The PRIME MINISTER: Yes, for the time being they are seconded.

Sir N. GRATTAN-DOYLE: Can the right hon. Gentleman say what measure of co-ordination, if any, has been established with the civil servants and the others on the Board sitting with them?

The PRIME MINISTER: I have said that they are performing the ordinary functions of civil servants, and they are in the same relation to Ministers as they were when they were in their Departments.

Mr. W. J. BROWN: Can the Prime Minister assure the House that if and when civil servants are appointed to carry out this kind of function the old tradition of preserving their anonymity will be carried out in this House?

The PRIME MINISTER: I have said that that will be done, and I shall continue to do so.

Mr. BROWN: I am very glad to hear that.

Sir K. WOOD: Did not the right hon. Gentleman announce the name of the chairman of this Committee as a permanent civil servant? And he volunteered the information!

The PRIME MINISTER: The right hon. Gentleman, as usual, is misinformed. I announced no name of chairman because no such office exists.

Sir K. WOOD: But the right hon. Gentleman mentioned the name of the permanent secretary at the Home Office.

The PRIME MINISTER: No.

LEWISHAM.

Sir ASSHETON POWNALL: 63.
asked the Minister of Labour at the latest available date, the number of unemployed in Lewisham; and what was the figure a year before?

The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR: (Mr. Lawson): At 16th June, 1930, there were 2,201 persons on the registers of Employment Exchanges who were resident in the Metropolitan Borough of Lewisham as compared with 1,416 at 17th June, 1929.

SEVERN BRIDGE AND BARRAGE SCHEME.

Mr. VAUGHAN: 69.
asked the Minister of Transport whether, in view of the increased gravity of the unemployment problem, he can take special steps to accelerate the Committee's report upon the Severn Bridge and barrage?

The MINISTER of TRANSPORT (Mr. Herbert Morrison): I understand that the investigations regarding this highly technical proposal are being pursued as rapidly as possible, but that it will not be practicable to complete them till towards the end of next year.

Oral Answers to Questions — OFFICIAL SECRETS ACT.

Sir N. GRATTAN-DOYLE: 51.
asked the Prime Minister whether he has as yet received the deputation of the Newspaper Proprietors' Association with reference to action taken under the Official Secrets Act; and, if so, whether he can communicate to the House the result of the deputation's representations?

The PRIME MINISTER: The answer to the first part of the question is in the negative. As already announced, it my intention to receive a deputation from the Newspaper Proprietors' Association as soon as I can conveniently do so, and when I have been advised upon the case which has been put before me.

Oral Answers to Questions — INCOME TAX (UNEMPLOYMENT GRANTS).

Mr. E. BROWN: 52.
asked the Prime Minister whether it is the policy of the Government to demand Income Tax at the standard rate from local authorities and other bodies who are accelerating work in relief of unemployment in respect
of grants made for works which are technically revenue producing; and, if so, whether this decision was formally arrived at and when, or if it is the result of departmental official action?

The CHANCELLOR of the EXCHEQUER (Mr. Philip Snowden): Income Tax law requires that annual grants of a revenue character made to local authorities or other bodies for the purposes of their trading undertakings should be taken into account in the same way as other revenue receipts in computing the profits of those undertakings for income Tax purposes. This question in relation to unemployment grants has been before the Board of Inland Revenue on several occasions from 1923 onwards and they have always taken this view which is based on judicial decisions of long standing.

Mr. BROWN: Can the right hon. Gentleman say how this can have been based on a judicial decision of long standing, seeing that these grants only began to operate in this form in the year 1923, as the result of the setting up of the St. Davids Committee?

Mr. SNOWDEN: 1923 is rather a long time ago. As the hon. Member knows, there has recently been another case in the courts which has been decided in favour of the Inland Revenue.

Mr. BROWN: Is the right hon. Gentleman aware that so little is this known in his own Department that some demands—I have the papers in my pocket—for 1924 were only first intimated to the local authorities on the 17th December, 1929, and is not this inimical to the whole policy of unemployment grants to make work?

Mr. SNOWDEN: The hon. Member is exaggerating the importance and universality of the papers which he has in his pocket. It is true that there have been a very few cases where, through a misunderstanding the law was not applied, and I believe that applications have been made for the outstanding amounts.

Sir HERBERT SAMUEL: Has the Chancellor of the Exchequer taken into account the fact that many local authorities have been invited by the Government to undertake work, in order not
merely to increase the amenities and equipment of their towns, but also to give work to the unemployed, and that large numbers have done so on the understanding that the Government would give them grants, and instead of those grants being made in lump sums they are being made in the form of annual grants in relief of the interest to be paid on these loans; that these enterprises, although referred to as revenue producing enterprises, usually involve a charge on the rates, although they bring in a certain income, and that as the outcome of all this the local authorities will be getting 20 per cent. less than they anticipated they would receive? Has the right hon. Gentleman taken these facts into account, or am I misinformed?

Mr. SNOWDEN: The right hon. Gentleman is wholly misinformed. The hon. Member for Leith (Mr. E. Brown) has given notice that he will raise this matter on the Adjournment tomorrow——

Mr. BROWN: On Thursday.

Mr. SNOWDEN: —and that will give a more appropriate opportunity for discussion than at question time. I may say, in reply to the right hon. Gentleman, that the point at issue is this, that upon the whole interest of the loan the Income Tax is deducted, but it is not the Income Tax of the local authorities but the Income Tax of the stockholders. What the right hon. Gentleman appears to have in his mind is this, that the local authority, having deducted the whole of the Income Tax upon the interest paid to these stockholders, should be able to keep that part which is due to the Inland Revenue, and, instead of the local authority getting less Income Tax, if they were permitted to keep that part they would be getting considerably more than 20 per cent.

Mr. BROWN: Is the right hon. Gentleman aware that that is not so in the cases that we raised?

Mr. BROWN: 68.
asked the Chancellor of the Exchequer the authorities under which grants to local authorities to aid works in relief of unemployment are divided into grants to revenue and non-revenue producing works, respectively, giving the references to the relevant Sec-
tion of the Acts if the basis is statutory or, alternatively, if it rests on a Treasury Minute, if he will state its date and make its contents available to Members of the House?

Mr. LAWSON: I have been asked to reply. The authority to make grants to local authorities in aid of relief works is contained in Part II of the Development (Loan Guarantees and Grants) Act, 1929. The terms and conditions of grant as announced by the Unemployment Grants Committee in regard to all classes of works are determined by my right hon. Friend the Minister of Labour with the approval of the Treasury, and may be varied from time to time as circumstances may require. I am sending the hon. Member a copy of a leaflet (U.G.C. 25) which indicates the terms and conditions of grant which are available at the moment.

Mr. BROWN: Therefore, the distinction drawn does not rest in terms in the Statute but is departmental in origin?

Mr. LAWSON: Under the Act my right hon. Friend has power to make conditions.

Mr. BROWN: But there is no reference in the Statute to this distinction, which itself is departmental in origin?

Mr. LAWSON: It would be true to say that my right hon. Friend is exercising statutory powers.

Sir H. SAMUEL: Can the Parliamentary Secretary say whether undertakings are passed as revenue producing, though, as a matter of fact, they bring in no revenue, but involve a charge upon the rates, and whether, nevertheless, they are to be liable to Income Tax?

Mr. HORE-BELISHA: May I ask whether Lord St. Davids Committee, at the time they made these grants, were aware that Income Tax would be deducted, and, if so, whether they proportionately increased the grants?

Mr. LAWSON: I cannot say. With reference to the question of the right hon. Member for Darwen (Sir H. Samuel) may I point out that the Chancellor of the Exchequer dealt with that point in his reply to a previous question?

Oral Answers to Questions — SOLICITORS (FRAUDULENT CONVERSIONS).

Sir JOHN FERGUSON: 59.
asked the Attorney-General if he has yet received any intimation as to whether the Law Society, as a result of the meeting of the Provincial Law Societies, on 20th June, are in favour of the initiation of legislation designed to protect the public against losses through fraudulent conversion by solicitors of property entrusted to them by clients?

Mr. PARKINSON (Lord of the Treasury): I have been asked to reply. My hon. and learned Friend has not as yet received any account of the proceedings at the meeting of the Provincial Law Societies on Friday last. He understands that the meeting of the Law Society, at which the decision of the Provincial Law Societies will be considered, will be held at an early date in July. He has not yet received any intimation of the course which the Law Society proposes to take.

Sir J. FERGUSON: Will the hon. Member ask his hon. and learned Friend to take up this matter and to press it to the end as soon as he can, because on several occasions unfortunate incidents have occurred and title deeds have been removed from solicitors and placed in the bank, for safe custody, and I, along with many other people, would like suspicion removed from the shoulders of large numbers of honourable men?

Mr. PARKINSON: I will convey the hon. Member's remarks to my hon. and learned Friend.

Oral Answers to Questions — FOXES BRIDGE COLLIERY, CINDERFORD.

Mr. VAUGHAN: 62.
asked the Parliamentary Secretary to the Board of Trade, as representing the Forestry Commissioners, whether he is aware of the dismantling now proceeding at the Foxes Bridge Colliery, near Cinderford; that the Forestry Commission will in consequence lose an income or royalties of about £1,000 per annum; and that the principal cause of closing is the flooding of water from an adjacent mine recently closed on Crown lands; whether he will see that the Commission takes urgent steps to prevent the water from the disused
mine flooding the Foxes Bridge Colliery, or compensate the owners for the cost of pumping the water; and whether he is aware that if the Foxes Bridge Colliery is closed the water will flood and cause to close still more collieries?

Mr. W. R. SMITH: The Forestry Commissioners are not aware of any dismantling at Foxes Bridge Colliery beyond the taking up of a few tram lines, but they are aware that the company is being voluntarily wound up, and that unless a new letting is arranged the Commissioners will lose rent or royalties of about £700 per annum. A certain amount of water has worked through from an adjacent mine recently closed, but the quantity is relatively small and could, in fact should, have been dealt with by Foxes Bridge Colliery Company in the ordinary course of management. A method of dealing with the water at a reasonable cost was pointed out to the company. The Commissioners are not under any liability to prevent the water working through from the disused mine or to compensate Foxes Bridge Colliery Company, and are not prepared to do so. It is possible that other collieries may be affected if Foxes Bridge Colliery is closed.

Mr. VAUGHAN: In view of the prevailing unemployment, will the Board of Trade ascertain from the present owners whether this colliery could be kept going if this surplus water was dealt with by the commission or somebody else?

Mr. SMITH: I believe that question has been discussed, and that methods have been pointed out to the company of dealing with the surplus water.

Oral Answers to Questions — EDUCATION (PLAYING FACILITIES, SOUTHWARK).

Mr. DAY: 67.
asked the President of the Board of Education whether his attention has been drawn to the limited playing facilities for the children in the borough of Southwark; and will he consider suggesting to the authorities who control the schools in this borough that certain of the schoolrooms should be thrown open for the use of children especially for this purpose in bad weather?

The PARLIAMENTARY SECRETARY to the BOARD of EDUCATION (Mr. Morgan Jones): The attention of my right hon. Friend has not been specially drawn to the limited playing facilities for children in Southwark. He understands that, in addition to such open spaces as are available, nearly all the playgrounds of the council elementary schools are kept open in the evenings during the summer months for children's play. While he would, of course, welcome any extension of the available facilities, he is afraid that the need for proper supervision would make it very difficult to arrange for the use of school buildings for the purposes of play, except where organised play centres are conducted, as is already done in a few schools.

Mr. DAY: Can the hon. Member say whether the local borough council have made any application for school-rooms to be thrown open on wet days?

Mr. JONES: The first sentence of the reply is that the attention of my right hon. Friend has not been specially drawn to that matter.

BUSINESS OF THE HOUSE.

Mr. STANLEY BALDWIN: May I ask the Prime Minister what Supply business will be taken on Thursday; and perhaps the right hon. Gentleman will tell us at the same time how far he proposes to ask us to go in the consideration of the Finance Bill to-day?

The PRIME MINISTER: The answer to the first question of the right hon. Gentleman is that on Thursday it is proposed to put down the Dominions and Colonial Offices Votes. As to the second question, I am afraid that I cannot at this moment give any definite answer.

Mr. CHURCHILL: Surely the Chancellor of the Exchequer would be well advised at this stage to let us know his general wishes as to the amount of progress he desires to make on the Finance Bill this evening?

Mr. P. SNOWDEN: My general wish is that we should get as far as possible. The next two or three Clauses ought not to occupy very much time. The first two, at any rate, deal with points which have been debated at great length
already. The general question as to the assimilation of the method of assessment as between London and the provinces has been already discussed. I do not think that the next two or three Clauses ought to take very much time, but Clause 29 and the two or three Clauses which follow do raise matters of great importance, and I do not want to limit the discussion upon them at all. I think we should get to the end of Clause 29 today.

Mr. CHURCHILL: I think the right hon. Gentleman might consider getting Clauses 26 and 27 and thus complete Part II of the Bill altogether. Clause 28 is most important as it deals with a substantial increase of taxation in the Estate Duty. It is of far-reaching financial importance. I think the right hon. Gentleman should be satisfied in getting to the end of Clause 28 to-day, and we might separate at a reasonable hour. There is absolutely no question of our obtaining Clause 29, and I submit that it really would be a great mistake to break in upon the group of five Clauses which deal with quite different matters. The whole principle of this group of Clauses will come up on Clause 29, and very important questions of procedure and order will also arise. I think it would be in accordance with the proper conduct of our debate if we stopped at the end of Clause 28 and began on Wednesday the issues which arise under Clause 29. I hope the right hon. Gentleman will not put this suggestion aside, because there is no doubt that Clause 26, which deals with London valuation is one which, with the greatest good will in the world, can only be compressed into a seven or eight-hours' debate.

Mr. SNOWDEN: Nobody will maintain that we have made even reasonable progress with the Bill so far. This is the sixth or seventh day in Committee, and we have reached only Clause 26. Suppose that we stop at the end of Clause 28 to-day, would the right hon. Gentleman help me to get Clause 29 and the following Clauses dealing with the same matter on the next day?

Sir LAMING WORTHINGTON - EVANS: I have no doubt that the Chancellor of the Exchequer has considered Clauses 29 to 33, but with the best will in the world it will be impossible to dispose of those Clauses in a day. There are hundreds of Amendments to them on
the Paper, and 20, 30 and even 40 of them are important Amendments. It will be quite impossible to dispose of them in one day, and I doubt whether it would be possible in two days.

Orders of the Day — FINANCE BILL.

Further considered in Committee. [Progress, 19th June.]

[Mr. ROBERT YOUNG in the Chair.]

CLAUSE 26.—(Annual value of property in London for purposes of Income Tax.)

Mr. MARJORIBANKS: I beg to move, in page 22, line 13, to leave out Subsection (1).
I venture with great respect to disagree with the statement of the Chancellor of the Exchequer that this matter had already been discussed, and that, therefore, we ought to be able to get through it quickly. On the contrary I assert that the matter was deliberately excluded from our discussions on the last day when the Bill was before the Committee, and that the Chancellor of the Exchequer then expressly said that he did not wish in any way to limit the discussion when it came on. The Amendment raises nearly all the numerous points which arise out of this change of procedure. There are on the Order Paper some Amendments, therefore, which could be discussed a little more shortly than would otherwise be the case if you, Mr. Chairman, had not kindly called my Amendment first. The third Amendment on the Paper is perhaps a small matter but is one of immense difficulty, and I would, with your permission, like to deal with it at some length separately.

The CHAIRMAN: The third Amendment on the Paper raises a subject which was dealt with on Clause 3.

Mr. MARJORIBANKS: If you will remember, we discussed the question on Clause 3 but never got an answer to our inquiries. I would like to deal with the matter separately now and to contend that the Chancellor of the Exchequer, in such reply as he gave on that earlier Clause, was not right. It is, therefore, not our fault if we wish to raise the question again.

The CHAIRMAN: Clause 3 has already been passed.

Mr. MARJORIBANKS: But in the Debate on Clause 3—

The CHAIRMAN: Clause 3 covers the matter that is dealt with in the third Amendment on the Paper. If the hon. Member is not satisfied he must deal with the matter later and at another stage, but not on this Clause.

Mr. MARJORIBANKS: The Chancellor of the Exchequer said that Clause 3 was governed by Clause 26. I presume it will be in order to refer to the matter on the question that Clause 26 stand part of the Bill. Let me deal with the Amendment that I have moved. This is a matter of very great importance. All these valuation Clauses are going to be of great lucrative value to the Chancellor of the Exchequer. I believe he said that the increased revenue in London alone would be £500,000. That is a very large revenue—and in spite of the fact that London has been re-assessed every five years. It calls attention to the immense revenue which will be raised throughout the country on the revaluation in places where there has not been continuous revaluation.
I wish to ask the Chancellor of the Exchequer whether he took into account this immense increase of revenue, of many millions, in estimating his revenue for next year? If he did not do so, he should tell the Committee now. The taxpayer has a right to know how he is going to be affected by this matter. It is quite against all justice that his pocket should be picked by the Chancellor of the Exchequer without his being aware of the matter. These Schedule A assessments will, of course, affect a very large number of people throughout the country, and a very much larger class of people than would be affected by the simple raising of the Income Tax by 6d. There is one aspect of the question which must appeal to hon. Members opposite. How will this change affect those old age pensioners who draw the original old age pension for which there is no means qualification? Many of them own their houses, and if the assessment goes up they may possibly be disqualified for their old age pensions. It is a point of detail but is one which ought to be considered.
I have said on a previous occasion that this will be a very lucrative set of Clauses to the Chancellor of the Exchequer, and that there are two main areas of grievance, the country grievance and the London grievance. We dealt exclusively
with the provincial grievance the other day, and now we come to London. At the outset I wish to state the fact that London really has set the pace to the whole of England with regard to local and Imperial taxation. I stated the other day that the local taxation authorities and the local rating authorities had more or less come together in many parts of the country and had recognised in principle that a house, every property, should be assessed once for all purposes—that a house should be assessed at the same value for all purposes, so that the multiplicity of values, often absolutely fictitious, should not confuse a taxpayer and raise grievances in his mind.
I would like to refer to the debate on the Rating and Valuation Act of 1925. Some considerable reading is required to discover what was the policy of the Government at that time with regard to a single valuation. My right hon. Friend the late Minister of Health used these words in introducing the Rating and Valuation Bill on 13th May, 1925:
This ideal of a single valuation has been recommended for years past by Royal Commissions, by Committees, by associations of local authorities, by surveyors' institutions, and so forth. I find in the Report of the Royal Commission on Imperial and Local Taxation, which came out in 1901, the statement—
'A general desire has been expressed by most of the witnesses, and in a number of resolutions which have been forwarded to us by public bodies, that it is desirable to have one valuation authority and one system of arriving at valuations for the whole rating area over which common rates are raised; that upon such valuation all rates and taxes, both for local and Imperial purposes, should be charged and levied; and, further, that, if possible, provision should be made to obtain uniformity in valuation throughout the whole country.'
4.0 p.m.
That is a very specific and definite opinion by the Royal Commission which was set up to inquire into this matter. It may be interesting to read the opinion, also cited by my right hon. Friend, of one of the very greatest authorities in this country, Sir Henry Trustram Eve, who said in 1912:
We are unanimous in thinking that we want one rateable value for rates and taxes, and we took a leading part under the Bill of 1904 in that direction. I, personally, was one of the deputation of three that went to see Mr. Long. We asked for that, and we pointed out in our memorandum. … that
there were five rates and taxes which could have different totals presented to the ratepayers. …
That situation now is, of course, simplified, thanks to the right hon. Gentleman the late Minister of Health. Sir Henry Trustram Eve went on:
The answer of the Local Government Board was that they had nothing to do with Somerset House, and we ventured to say that we wanted to talk to the Cabinet."—[OFFICIAL REPORT, 13th May, 1925; col. 1884, Vol. 183.]
and so on. It was evident that it was very unjust that there should be different valuations for the same property for different purposes. It seems to me to be absolutely unanswerable. This was the principle for so long adopted in the provinces between the local rating authorities and the local taxing authorities, but as long ago as 1869 the matter was crystalised in legislation for London, the largest and, I venture to say, the most progressive and most humane city in the world. By their Act of 1869 they provided a single valuation, and made the rating valuation conclusive for all purposes of Income Tax. That, of course, was a very great advance on what had taken place before. London was the pioneer, and it was hoped at the time that other parts of England would eventually follow. Under this Act there has grown up a very efficient organisation for the valuation of property. It has, of course, adapted the personnel and the machinery of the finest Courts of Law in order to assess the most valuable property in the world—the real property of the City of London. We have this fine machinery set up, and it is conclusive for all purposes. I think it has met with the approval of almost everyone in London, except, perhaps, some of the Somerset House and Income Tax officials, and even, perhaps, some of the local authorities. The rating authorities, the taxing authorities, the ratepayers and the taxpayers, at any rate, agree that it is simple, ordinary procedure which everybody can understand. The Londoner realised that once his house was valued for all purposes, that was its value. He has had this simple procedure and has not had the grievances of other citizens in the country.
Apart from the mere question of single as opposed to double valuation, I would like to point out the advantages which
the citizen of London has with regard to appeal as compared with the disadvantages of other people in the country, and which the London people will also have if the Clause secures the approval of this Committee. First, of course, if he is dissatisfied, he goes to the assessment committee. He may appeal to that committee under Section 32 of the Act both on law and on fact. He may then enter an appeal on law or fact to the quarter sessions, which, I should think, was the very finest tribunal set up for this purpose, which may receive evidence and consider the matter judically, according to the rules of evidence in Courts of this country. Therefore, there are two appeals on law and on fact under the present procedure, and if a person is dissatisfied, he can appeal to the highest Court of the land by special case or certiorari. That gives him a very elaborate, a very efficient system of appeal which he can take up to two Courts. He can have it tried by a Judge in the best possible way, and, of course, apart from anything else, the decision of the Court is a final one in the sense that it is conclusive for all purposes. The appeal is an appeal in respect of rates, and it is an appeal in respect of taxes.
Let us compare this procedure with the procedure if this Clause passes into law. A citizen will have, of course, this procedure for rating purposes, which will continue, but for Income Tax purposes he will have quite a different procedure. He will have the expense of an alternative appeal. If he wants to appeal, he must appeal to two courts—first to that for rates, and then to the Income Tax authorities for the purpose of Income Tax. He will be able to appeal to the general commissioners of Income Tax on law and on fact, and he can appeal on difficult questions of law to the court, but he has only one appeal, and that is to the general commissioners. I would be far from criticising the character of the general commissioners of Income Tax. If the Committee wish to see the finest flower the commissioners can produce, here is the hon. Member for East Fulham (Sir K. Vaughan-Morgan). I do not know whether the Income Tax Commissioners produce so fine a flower from every bush, but one is inclined to think that so splendid an example may be, perhaps, rare. The Committee will have
an opportunity, no doubt, of hearing his opinion upon this matter. If this Clause is passed, his responsibilities and, perhaps, his powers will be considerably increased. I do not know whether he will welcome that or not; perhaps he will not.
I would like to consider the advantages of an ordinary Court of Law as compared with the court of the general commissioners of Income Tax. We believe in civilised jurisprudence in this country. The beginning of jurisprudence comes about in this way. A judge is appointed to sit under a coco or palm tree, and he is usually chosen because he has a special knowledge of the subject matter upon which he has to give a decision. That is a very simple way of doing justice. When you come to a more complicated jurisprudence in a more complicated society, of course you do not employ a palm tree judge, but you appoint a judge who is learned in the law, who has no prejudices, who requires facts to be proved. That is the very essence of civilised jurisprudence. Here we have a reversion to the primitive form of justice which I have tried to describe. You may go to the general commissioners, who are
to determine the question to the best of their judgment, and are entitled to avail themselves of their personal knowledge of the value of property in the district, and of the nature and history of the property in question.
In fact, the judge is to be the expert witness. My hon. Friend says "No," but I am quoting from a standard authority on Income Tax law, and, in fact, I have been told that the general commissioners have been chosen because of their special knowledge. Let the hon. Gentleman contradict that if he can. There you get a really retrograde movement. You are ousted from the jurisdiction of the courts and of the judge, who is prepared to consider evidence, and you substitute for him an expert tribunal. That, surely, is a reversion to primitive times. There is the grievance as regards the appeal to a single tribunal, which does not hear evidence in the same way as a Court of Law, but as a committee of experts. Finally, instead of the economy under the present system of one appeal, you now have two appeals. The poor, wretched owner of property in this country has to appeal to one court
for one purpose and to another court for another purpose, and supposing they differ, what feelings of injustice will arise in his mind! Supposing the quarter sessions decided that his property was worth £100 for rateable value, and the general commissioners of Income Tax found it was worth twice that amount. With what feelings of grievance and disgust would the ratepayer of the City of London regard the right hon. Gentleman opposite who introduced this retrograde change!
There is another matter. I forgot to mention the fact that the general commissioners may call in an expert, whose valuation is absolutely conclusive, and, therefore, the right of appeal is gone. My right hon. Friend will bear me out with regard to that particular matter. There is the famous case of Stocks v. Sulley, which was absolutely conclusive. Apart from this matter, we find that under the procedure which has been set up under the Act of 1869, courts have to consider the deductions and allowances to be made, and this system has worked so well, that it was quite unnecessary to move Amendments to the Finance Act from time to time. It was elastic and efficient, and the decisions were known to be fair and proper. But now, of course, we shall be bound by the strict rules of the Finance Act, 1923. With regard to deductions, we are bound by Section 28 (2) of the Finance Act, 1923. I will not weary the Committee with reading out the whole of that long Sub-section, but it ties down the taxing authorities to certain crystallised deductions and allowances. Instead of having an elastic tribunal, which is able to adapt itself to the particular circumstances of the case, we have a rule-of-thumb applied under the Finance Act, 1923, and that is, of course, a great disadvantage.
The Chancellor of the Exchequer says that this proposal will make for uniformity, but as a matter of fact there is no uniformity whatever arising out of this change. Uniformity was necessary for the purpose of the Act of my right hon. Friend the ex-Minister of Health last year. There it was essential, but you have your uniformity for rates, and why should you tie down London to the exact method of raising taxes which is applied in the provinces when you have a much more efficient method in London? You
have your rating uniformity. Why bring London back to the methods which were applied in mid-Victorian times? It seems an unnecessary, retrograde, and reactionary step. The uniformity is of course merely illusory.
I would have raised this whole matter on Clause 23, but the Chancellor of the Exchequer very kindly said that he would allow it to be fully discussed on this Clause. What I would have said on Clause 23 is this. When I look at the First Schedule, which is to provide the machinery for setting up the new officials and the new method throughout the country, I see that there is no application to London of this system which is to produce uniformity. That seems a little surprising, and it is even more surprising when one goes into the matter and finds that, in the past, it has been the assessors of taxes in the country, appointed by the general commissioners, in whose hands the assessment and valuation of property generally has been placed, but in London, up to now, I think it is the surveyors of taxes, or at any rate Somerset House officials, who have been the valuing authorities for Income Tax purposes. That did not matter formerly because they had to take their valuations directly and conclusively from the rating authorities, but now the rating authorities' decisions are not to be conclusive. One would imagine then that there would be set up an enormous new independent officialdom to deal with the valuation of the most complex, the richest, the most changing real property in the world. But not at all. We find no provision whatever. What are we to think?
The only conclusion which comes to one's mind is that the surveyors of taxes are to continue to be the authorities on this matter, and that the whole thing is going to be in the hands of Somerset House. Many of us have good reason for thinking that Somerset House officials have wished to get the valuation of property into their hands for many years and now at last they have succeeded. I hope, therefore, that either the Chancellor of the Exchequer or the Financial Secretary will state if the valuation of the whole of London is to be put in the hands of these taxing officials. By taxing officials I do not mean the general commissioners or anybody so important as that; I mean the Somerset House officials. This
change seems to contain so many disadvantages and so few advantages that one seeks to find a reason why this progressive Government should be taking such a turn for reaction. Why are they going back to the standard of mid-Victorian times? Why are they destroying the pioneer work which has been done and the new precedents which have been created? One has already had an answer in general terms from the Chancellor of the Exchequer, who has told us that he is going to raise considerable revenue by the proposal. If the only purpose of the change is the raising of revenue, the right hon. Gentleman ought to say so definitely. If it is necessary to eliminate the public right of appeal, to change a simple system into a complex system, to oust the jurisdiction of the Courts, and establish a system of droit administratif in order to raise revenue, let the right hon. Gentleman face it, but I have yet to hear any other convincing arguments with regard to this matter.
I think there is hardly any advantage in the proposal except as regards a matter of the merest detail, and I think the right hon. Gentleman is employing an immense piece of artillery to crush a fly. The only possible advantage which seems to come to anybody out of this proposal is that it will deal with the point that under the present system the gross value of a house must be taken conclusively, as its value for Income Tax purposes even though the rent paid is higher. That matter, however, could be very simply dealt with and has already been dealt with in a provisional way in draft recommendations put forward by the Westminster local authority for an Act of Parliament, and any hon. Members who wish to refer to those recommendations can do so. That proposal was to make provision which would render this rule non-effective. Of course it is a tiny amendment of the law which could be carried out in a different way from this proposal. I think I have raised all the points which I wish to bring before the right hon. Gentleman except the point in regard to Excise Duty, and I wish to give formal notice to the Chancellor of the Exchequer that if I do not deal with that now I shall go into it later on.

The CHAIRMAN: If the hon. Member is referring to the Amendment on the
Paper in his name—in page 22, line 15, at the end to insert:
except with regard to duties on any excise licence charged by reference to the annual value.
—I must point out to him that that matter was settled on Clause 3 and cannot be discussed on this Clause.

Mr. MARJORIBANKS: May I point out that the Chancellor of the Exchequer himself said——

The CHAIRMAN: I am not concerned with what the Chancellor of the Exchequer said. If the matter has been settled on Clause 3 it cannot be discussed on this Clause.

Mr. MARJORIBANKS: Very well. The Chancellor of the Exchequer will have to listen to me upon it later. To recapitulate shortly my grievances regarding this very drastic change in the law governing the valuation of property for Income Tax purposes in London, I say that it is retrograde and reactionary, that it does no good except to raise revenue for the Crown, that it limits the power of proper deductions for expenses and, above all, it sets the clock back to 1868. As far as the ratepayers of London are concerned I think it will be one more nail in the coffin of the right hon. Gentleman's Government.

Sir KENYON VAUGHAN-MORGAN: I wish to thank my hon. Friend the Member for Eastbourne (Mr. Marjoribanks) for his references to the general commissioners of Income Tax in the course of his very interesting review of the present system of valuation in London, but I should like to reassure him on one or two points and to explain that the general commissioners do not, as far as. I know, deserve either the encomiums or the reverse of encomiums which are commonly associated with the description of "expert witnesses." We sit as practical people, discussing and judging practical questions in a practical way. So far from being elements in the machine of taxation, from the point of view of Somerset House, we really act as a buffer between the Revenue and the taxpayer. It is our function to see that the scales are held fairly between the two sides and it is a function which, I think, we succeed in performing satisfactorily. I disagree profoundly with my hon. Friend the Member for Eastbourne in regard to
the merits of the existing Act and procedure and consequently also in regard to the suggested advantage of his Amendment. I think the Clauses of the Finance Bill in this matter represent an improvement and not a reactionary or retrograde step. I am glad to be relieved of the 1869 Act and those other mid-Victorian enactments for which my hon. Friend has so much admiration. As a general commissioner I sit for a district which includes parts inside and parts outside the Metropolitan area, and, consequently, I have, within that limited purview, a view of both sides of the question of the operation both of the single valuation and of the separate valuation systems, and I am a convinced adherent of the principle of the separate valuation.
The hon. Member for Eastbourne based his plea to a large extent on the importance of conformity or uniformity. With that idea I entirely agree. The Act of 1869 was presented, recommended, advocated, and generally supported on the ground that it provided uniformity. It may have done so in 1869, but it certainly does not do so now. When the ex-Minister of Health introduced his Rating and Valuation Act in 1925 arguments were used similar to those put forward by my hon. Friend in moving this Amendment, but we ought to refresh our memories with some recent history in dealing with this matter. In the course of the Committee stage of that Measure the policy of the then Government was reversed. The 1925 Measure, as originally introduced, proposed to apply to London the system of the rest of the country, but during the Committee stage the Measure was entirely changed in this respect. In the course of subsequent debates in Committee stage I ventured to plead with the ex-Minister of Health that London should be allowed to come back into the Bill with a view to getting the advantage of the separate valuation which was conferred on the rest of the country. That is the point of view which I have always taken up on this matter. As long as we could have uniformity on the principle of the Act of 1869 that would be another matter, but if the country is not to have it, or anything corresponding to it, I think the time is ripe for relieving London of its disadvantages. That was the course of the debates in 1925. At that time there was a large measure of
unanimity in the London boroughs as well as in the London County Council on the matter. They wished London to be included in the amended Measure at that time.
At a later stage, when London was finally excluded, as the right hon. Gentleman the Member for West Woolwich (Sir K. Wood) knows it was on the understanding that a separate Measure would be introduced. At a later stage still the Metropolitan Boroughs Standing Joint Committee and the London County Council came to an agreement—not with entire unanimity, because I do not think the City of Westminster agreed, but apart from them with general unanimity—that questions outstanding between them should be referred to the Minister of Health for his adjudication. One of the questions to be definitely settled was whether London should retain its single valuation system or go over to the separate valuation system. Well that question has now been settled, not, it is true, by the ex-Minister of Health, but in accordance with the views of the present Chancellor of the Exchequer, and there is now embodied in the Finance Bill provisions which will give London the benefit, as I consider it, of the separate valuation system. It may be urged that a Finance Bill is hardly the place in which to make a legislative change of that kind. I agree that it is not the ideal place, and although I agree in principle with the proposal I can, I think, quite properly demur to a general acceptance of the idea that the Finance Bill is the right place in which to make changes of this kind. I agree also with my hon. Friend who moved the Amendment as to the great importance of the question of statutory allowances and deductions.
My hon. Friend challenged the necessity for that strict measure of uniformity in valuation between London and districts outside, to which I attach so much importance. I can give an example or two as to why it is necessary for London to have the same system as the rest of the country. If you take the Metropolitan Water Board, the sums levied by that Board are levied on areas which extend outside the Metropolitan area, and consequently for those precepts to have a fair operation on the ratepayers, it is essential that the basis of valuation
should be uniform throughout the whole area. The same applies to the services for the maintenance of the Metropolitan Police. In regard to the Metropolitan Water Board, it has been contended on behalf of London citizens that under the present system, or, if not the present system, under the system obtaining prior to the Rating and Valuation Act of 1925, London was losing or bearing a higher charge than properly its share by an amount estimated at about £100,000 per annum. At any rate, whether or not that figure be exact to-day, it is sufficient to show the immense importance of uniformity and the grave danger of injustice which must result from any difference in system as between areas so closely contiguous and at the same time and necessarily included in the same area for certain purposes of rating and taxation. Parliament having determined in 1925 in favour of separate valuation for the rest of the country, it is important that we should have separate valuation for London.
I have for some time past regarded the methods of the Act of 1869 as unsatisfactory in operation for some of the reasons to which I have referred. It represents also an unhappy kind of compromise. We have to arrive as well as we may at some general line as between the valuation for rates and the valuation for taxes. Rates are, of course, a charge levied on the occupier, and a tax is a charge levied on the owner. It may be that the rent obtained for a hereditament is identical with the valuation for rates assessed under the ordinary system, but, on the other hand, it may not, and whereas nowadays the Chancellor of the Exchequer estimates that the Exchequer loses something like £500,000 a year, in times past that figure has been put a good deal higher.
In endevouring to arrive at this compromise method of valuation or the compromise figure, you may easily do one of two things. You may either put up the assessment for rates of your occupier at a higher figure than he ought to pay, or you may put the Schedule A Income Tax assessment for the owner at a figure below that which he ought to pay. After all, I do not see why income from property, after making all proper allowances for the special charges to which
that form of property is subjected, should be charged any less or any differently from income from any other source, and since this old Act of 1869 was first enacted nearly 60 years have elapsed, and things have very much altered. The old Income Tax has been multiplied by eight or even by nine, and the old occupiers' tax, called the Inhabited House Duty, no longer obtains. It was very small, but it was a charge on that form of property which has now been done away with.
With regard to procedure, my hon. Friend thinks that the Income Tax payer will suffer from not having the opportunity of an appeal such as the occupier now has in regard to rates, and there I must say that I disagree with him, because I think he has a better opportunity. I think that the simple form of applying to the Income Tax Commissioners is better than any system of complicated appeal which he now has, because he has always got his appeal on points of law. The basis of assessment for rates is the fair annual rental value of the hereditament, taking one year with another and comparing one property with another. The basis for Schedule A assessment is the income derived. Under the Act of 1869 that is where the compromise comes in, where you have to get at a figure between the two which satisfies both parties to the compromise. Rates, of course, are paid by the occupier on a, dual basis, having due regard to his ability to pay, but at the same time account must be taken of benefits received.

Sir KINGSLEY WOOD: Does the hon. Member mean compromise between the parties?

Sir K. VAUGHAN-MORGAN: I mean the compromise that has constantly to be arrived at in the Metropolitan area in carrying out the procedure under the Act of 1869. There is the danger of the occupier having his rateable value pushed up in order to meet the actual income derived from the property, or the owner of the property escapes some of the tax which he properly should pay. I have referred to the essential difference between the incidence of rates and taxes and the basis on which the valuation should be arrived at for the purposes of rates and taxes. The two things are entirely different.

Earl WINTERTON: I am sorry to interrupt the hon. Gentleman in his very interesting exposition of this Clause, but I would ask him to say whether, speaking with the great knowledge and experience that he has of administration in London, there have actually been cases of injustice to the class of persons he has mentioned, to the ratepayer on the one hand or the taxpayer on the other—the owner or the occupier.

Sir K. VAUGHAN-MORGAN: The Noble Lord asks whether cases of injustice have been brought to my notice which have adversely affected the occupier, who, of course, pays the rates, or the owner of the property, who should pay the taxes. I can give him a good many cases, which have been put before me—I can give him a whole list—which go to support the general contention that the Exchequer loses something which is estimated at not less than £500,000 a year, though I should have put it at a higher figure, under the present system; and that loss to the Exchequer, which may be the gain of certain property owners, is sporadic. It does not apply to every property owner, but only to some; some are fortunate and some unfortunate. The only difficulty which I foresee under the separate valuation system is that of the owner-occupier, but he has, as I know from experience, a very simple and ready remedy by going to the Income Tax Commissioners and putting his case before them. I have dealt with lots of such cases.
I have before me the objections, adduced by the city of Westminster, or rather by the late town clerk of the city of Westminster, who has always adopted a very determined attitude on this question. He it was who was largely instrumental in the change of view taken by the Standing Joint Committee of Metropolitan Boroughs in the course of the negotiations subsequent to the Committee stage of the Bill of 1925. In a circular which I have before me, the city of Westminster raises certain objections. It describes the Act of 1869, the procedure, and so on, and then it deals with appeals, and really I cannot see, on the face of it, that the taxpayers have any less appeal now than before. Then it deals with the loss of revenue and refers to the "outline" proposals which my hon. Friend mentioned. If Westminster favours those
"outline" proposals, it is surely an admission that there is something imperfect in the present system, which has always been held up by Westminster as the ideal.
The proposals were that where the rent reserved actually exceeds the Schedule A valuation, the difference should be paid, I think it was, under Schedule D, but that would apply only to the valuation year of the quinquennium. No provision was made for dealing with anything of that kind which might occur between. No; I am wrong. That was the recommendation of the Royal Commission of 1920. The "outline" proposal is that the actual amount should be taken as the gross, but that, although it is an advance in the direction that I favour, is an admission that the existing system is far from perfect. But the disadvantage of that is that it only deals with the valuation at one moment, namely, the beginning of the valuation period, and therefore it is insufficient and is just as apt to be harsh in one direction, or unfair to the Revenue, as the existing arrangement.
Another point in the Westminster scheme is that separate valuation would be costly, but I am advised that it would not. The figure which is mentioned is £15,000, but of course no one wants to waste that amount. In relation, however, to the advantage which would result, namely, a relief of the ratepayer who is assessed too high in order to meet Schedule A, and to the unfairness to the Revenue if the Schedule A assessment is not the amount actually reserved for rent, some expenditure may be justified in remedying an error of this kind.

Sir K. WOOD: Is it not a fact that that £15,000 would come from the Chancellor of the Exchequer?

Sir K. VAUGHAN-MORGAN: The paper which I have before me does not indicate the source of this money. The amount is mentioned in a resolution sent to me saying that the expenditure on a revaluation of London amounting to £15,000 would be a waste of public money. One does not want to waste £15,000, but that is not material to the relief which a successful application of a separate valuation for London would grant to the ratepayer, and the greater measure of fairness which would result as between one form of property and another, and one set of property owners
and another. I disagree with my hon. Friend the Member for Eastbourne; I do not agree with his arguments or his conclusions, and I hope that he will not press his Amendment. If he does, I shall not find myself in the Lobby supporting him.

Sir LAMING WORTHINGTON - EVANS: The debate has shown how interesting this question is. It has shown also that it is not a party question, for I find myself, in speaking in opposition to my hon. Friend the Member for East Fulham (Sir K. Vaughan-Morgan), deeply grateful to my hon. Friend the Member for Eastbourne (Mr. Marjori banks) for the excellent speech with which he moved this Amendment. I do not suggest that my hon. Friend the Member for East Fulham has not every right to address the Committee upon this subject, upon which he knows so much; my only surprise is that he expresses a view which seems so misguided. He talks of London having the benefit of a second costly valuation, and he quoted as a general opinion that the London boroughs were in favour of it. I notice, however, that the Standing Committee of the Metropolitan Boroughs expressed quite a different opinion in 1924. In speaking of the valuation that had taken place under the 1869 Act, they said that the system had worked well for over half a century, and they showed no desire whatever—then, at any rate—for the second valuation. This Amendment is to leave out Sub-section (1), which is in effect to repeal the provisions in the Act of 1869, which make what I may call the ratepayers' valuation conclusive upon Treasury, so that it is also binding from the taxpayers' point of view. The taxpayer and the ratepayer under the Act have one valuation and not two, and that is an immense advantage.
I happen to be the owner-occupier of a house in London. A quinquennial valuation is going on now, and upon that my assessment for rates will be fixed. I have now to go to the expense of instructing a surveyor to watch my interests, and to see that some exuberant spirit does not put the value of the house unduly high, or, at any rate, does not put it up beyond that of my neighbours. If this Clause goes through, I shall later on in the year be forced to do exactly
the same thing because the Inland Revenue will come along and make a valuation on their own account. I shall then have to try and get that checked by professional people to see that I am not assessed for Schedule A unduly high. When my hon. Friend says that the expense of this double valuation is to be £15,000, I wonder to whose expense he is referring.

Sir K. VAUGHAN-MORGAN: The figure given to me is represented to be the public expense.

Sir L. WORTHINGTON-EVANS: I imagine then that it is additional public expense for calling in qualified surveyors and others, who will go about London making a valuation. I cannot believe that £15,000 will anything like cover the expense of a Metropolitan valuation. It would require a large increase in staff and a great increase of professional employment. I was not thinking so much of the public expense, however; I was thinking of the individual's expense, because each individual who is assessed in the Metropolitan area for taxes will have to check his valuation, and, even if it costs only two guineas or four guineas to be properly advised, the multiplication of these few guineas by the number of assessments will bring the figure to infinitely more than £15,000. If anyone had told me that it would mean a charge on the taxpayer of an additional £150,000, I should have thought that he was much nearer.

Sir K. VAUGHAN-MORGAN: A great deal of the information is provided by the right hon. Gentleman as owner-occupier.

Sir L. WORTHINGTON-EVANS: That is the chief trouble. The average layman is not a valuer and knows little about the value of property. It is true that he gets a form sent to him which he has to fill up. I have just tried to fill up one for the quinquennial valuation in London, but for the life of me I do not know whether the information which I have given will produce a valuation with which I shall be satisfied. I have given the information honestly, but I do not know what the result of it is going to be. I do not so much mind if I am treated the same as my neighbours, but I should hate to know that my neighbours are
assessed lower than myself. So I have to get a professional man, whose business it is to know these things, to find out whether I am properly assessed. I want, as one of the representatives for Westminster, to answer my hon. Friend who attacked the Westminster scheme.

Sir K. VAUGHAN-MORGAN: I was not attacking it, but only correcting it.

Sir L. WORTHINGTON-EVANS: Sir John Hunt, who was Town Clerk and Chief of the Assessment Committee of Westminster, was without doubt a great authority on this question, and he clearly expressed a strong view diametrically opposed to that of my hon. Friend. That is the view which I want to put before the Committee. My hon. Friend, in moving this Amendment, called attention to the difference that will be made in future in regard to appeals. Let me summarise this position. At present, the one valuation does for both rates and taxes. If there is an objection to that valuation, there is an appeal to the assessment committee, and then to quarter sessions, and, on a point of law, a case can be stated for the High Court. The subject, therefore, is really protected in the best possible way. In future, that appeal will still be open as regards the assessment upon which rates are paid, but, as regards the assessment upon which taxes are paid, there will be no such appeal. The only appeal will be to the Commissioners of Taxes.

Sir K. VAUGHAN-MORGAN: That is on a point of fact. There is an appeal upon a point of law.

Sir L. WORTHINGTON-EVANS: I am not sure whether there is an appeal on a point of law. There is an appeal, as far as I know, to the Commissioners of Taxes only. My hon. Friend the Member for East Fulham said that the basis of valuation ought to be uniform. It ought to be uniform, and there would be a complaint about it not being uniform if it were at any time an under-valuation. He was challenged to give cases, if he could, where an under-valuation was alleged. I have the result, which was given by Sir John Hunt, of the alleged under-valuations which caused a loss to the Imperial Revenue. In those which refer to Westminster it is certain that
there is no intentional under-assessment—not that Westminster is an easy place to value; I should think that it is an exceptionally difficult place to value, but, if there had been under-valuation there, the inspectors of taxes, who have the right to appeal, would have appealed, and we should have found the assessments that have been made upset on a grand scale.
5.0 p.m.
In Westminster, there are 37,000 assessments, and against these 164 objections were made by the inspectors of taxes. The results of these 164 appeals were that 13 of them were withdrawn by the inspectors; in 50 cases, the gross values were increased by the assessment committee; and in 101 cases the overseer's figures were confirmed by the committee, or reduced on cross-objection by the taxpayers. Out of 37,000 assessments therefore, there were only these very few appeals, and not one-third of them were in any degree successful. The inspectors of taxes appealed at quarter sessions in four cases out, of the 164; they were all cases where the gross values, as finally determined by the assessment committee, were less than the rent, and all these appeals were settled out of court at sums below the rents, and in two cases very much below. There is a case, however, where the actual rent is below the assessment. That shows the need for an Amendment, and Sir John Hunt proposed a method. My hon. Friend referred to it, and claimed that it was an admission that the present system was not good. It was not an admission of anything of the sort, unless it could be shown that any other system would be better. On the contrary, we believe this system to be the best. There is a case where the rents are higher than the assessment, and in such instances it would be quite easy for the amount of the rent to be accepted in lieu of the assessment; nor would there be a difficulty if a change of rent occurred in the middle of the quinquennium, because the assessment could also be changed; with such elasticity the whole evil could well be met.
I only wish to deal briefly with this question, not because it is not an important one, but because there are a large number of hon. Members and friends of mine who wish to take part in
the debate; and finally I would say this: It rests with the Government to show cause why this Act of 1869, which, according to the Metropolitan Boroughs Standing Joint Committee, has worked well for more than half a century, should be repealed and a new system introduced. The onus of proof is upon the Government, and not upon us who have moved the Amendment. It is for the Government to make the case and for us to answer it; but the Government have been singularly silent up to now. They have allowed three speeches to be made from this side of the House. [Interruption.] I had hoped the Chancellor of the Exchequer would speak second, so that I could follow him; but I am not going to make any complaint on that score. It is for the Government to show cause why the present practice, which has worked admirably for 50 years, should be altered. To say that there is a case where the rent is higher than the assessment is only to say that that particular case needs amendment. The whole system ought not to be scrapped because there may be a blot here and there. It would be right and proper to remove blots, but not right or proper to scrap the whole system.

The FINANCIAL SECRETARY to the TREASURY (Mr. Pethick-Lawrence): Before the right hon. Gentleman the Member for St. George's, Westminster, leaves, I would like to say that both the Chancellor, who has had to go away to a very important engagement, and myself have been waiting here to speak, but it was represented to us on behalf of the Opposition, that it would be better to allow the debate to take the course it has taken. That is the only reason why we have not intervened before. I am sure the right hon. Gentleman will accept the explanation. In point of fact, I feel that my hon. and gallant Friend the Member for East Fulham (Sir K. Vaughan-Morgan) has put an exceedingly able case in favour of the Clause and, with his expert knowledge, he has presented the case far better than I could. I quite agree that at first sight, and without any knowledge of this matter, it would appear a simplification to have one valuation instead of two, but when the system is examined it is found that it does not work as fairly as the dual system. That fact is really
patent not merely to Members on this side of the House, but also to hon. Members opposite, because during the last Parliament the Government had the opportunity of carrying this simplified system in their Local Government Act. They could have said that the system which had worked in London since 1869 should be adopted not merely for London but for the whole country, but they deliberately rejected that system, and we are entitled to assume that they had good reasons for doing so.

Sir K. WOOD: Perhaps the hon. Gentleman will allow me to say that the system of single valuation was introduced by the late Government; it was submitted on the Second Reading of the Rating and Valuation Bill.

Mr. PETHICK-LAWRENCE: I think that makes the case stronger. I had forgotten that the late Government, in their first draft of the Bill, proposed to embody this system, and for the precise reason that I have suggested, that at first sight it seemed a simpler method of dealing with the situation. But later the House rejected that method, showing that on mature consideration it was found not really so satisfactory as the dual system. The first reason why this apparently simpler system is not really as equitable and as satisfactory is that the objectives of the rating valuation and of the taxation valuation are not identical. They are similar; a great deal of the ground is the same in two cases; but, in fact there is a discrepancy, and though in some cases that discrepancy may be small, in other cases it is considerable. As the hon. and gallant Member for East Fulham quite clearly pointed out, in one case you are endeavouring to place a tax upon the income received—or, if not the money received, at any rate the equivalent income received—and in the other case you are dealing partly with the amenities provided by the rates. Under the single valuation both the taxation and the rating authorities are hampered to some extent.
Our case in introducing this Clause is a very much stronger one than the case of the House of Commons during the last Parliament in rejecting the proposals put forward by the late Government, because had the proposals originally embodied in the late Government's Bill been carried, at least it could be pleaded on behalf
of them that they would establish uniformity. If we were to retain the present system of valuation in London, we should be stereotyping the reverse of uniformity. The House of Commons, in rejecting the proposals of the late Government, took the view that in spite of the lack of uniformity it was better to have the dual system in the provinces. In introducing this Clause we are establishing uniformity between London and the provinces; but, of course, I am not saying that merely for the sake of uniformity the Chancellor of the Exchequer would go to the trouble of bringing in this Clause. The valuations for the purposes of taxation revenue are to some extent hampered by the endeavour to make them identical with the valuations for rating purposes, and there is a distinct loss of revenue to the Exchequer, which my right hon. Friend, on the advice of those who give him information, has put at something like £500,000.
Hon. Members opposite may think that is an under-estimate, but certainly no one will deny that there is a substantial sum involved, and that it is desirable that the money should be available for the revenue. This change ought not to be made, however, if the proposal were an unjust one; but we maintain that it is essentially just. The proposal is to make the valuation in London uniform with that which takes place in other parts of the country and not to give an unfair privilege to the receivers of income from property in London such as is not enjoyed by owners of property elsewhere in the country. It is unreasonable that those who receive income from property outside London should have, in effect, to bear a higher burden than similar persons within the Metropolitan area; but if it be correct——

Mr. ARTHUR MICHAEL SAMUEL: If! Is it correct?

Mr. PETHICK-LAWRENCE: Yes. If it be true, and I do not think anyone has denied that it is true, that there is a loss of revenue owing to the present method of valuation——

Earl WINTERTON: The hon. Gentleman has made a vague reference to a loss of revenue. He has said, "If it be true" that there is a loss of revenue. That is a vague statement from the Financial Secretary.
We should like to know what the position is. I am open to conviction.

Mr. SAMUEL: Are we to understand that the London property owner or the London taxpayer is paying less than he should pay?

Mr. MARJORIBANKS: Is the hon. Member aware that the revenue officer has always had a right of appeal under the 1869 Act, and if there is any justification for the contention that property was undervalued why did not the officer exercise his right of appeal?

Mr. PETHICK-LAWRENCE: I think the answer to that question and to the Noble Lord has already been given, partly by the Chancellor of the Exchequer, partly by my hon. and gallant Friend the Member for East Fulham, and partly by myself in this very speech. The Noble Lord seemed to think that I was trying to ride off on the word "if." That is not my case at all. I said that it was estimated by those in a position to know that at least £500,000 is lost to the revenue in this way, and it is lost owing to the fact that these properties are undervalued in the sense that the full income received in respect of the properties does not pay its full share of tax. I do not think that can be denied, and if I said, "If that is so," I did not mean it to be assumed that that was not so. My point was that, assuming that that is so, broadly speaking, some property owners in London—not all—are given privileges which other property owners in other parts of the country do not receive, and I say that is unjust. I think I have given the reasons why the Government desire this change. I have shown that it is an equitable change, fair as between different classes of property owners, that the revenue loses improperly under the present system, and that the party opposite, when they were invited by their own Government to carry out uniformity in the opposite direction, definitely and deliberately refused to do so. I think the case for carrying the Clause in its present form is quite unanswerable.

Sir K. WOOD: I have before me a volume which contains a report of the proceedings on the previous Rating and Valuation Bill of 1925 when it went through Committee, and I would like to point out that a great deal of our time
was occupied by a discussion on the very subject which we are now considering. It is interesting to read the criticisms which were made from the Government benches on that occasion and to note the length of the discussions which took place on the Finance Bill. I was a member of the Government at that time; my right hon. Friend the Member for Edgbaston (Mr. Chamberlain) was the Minister of Health, and he had the task of piloting that Bill through the House. The question of London and whether the present practice should be observed, or whether a new one should be introduced dealing with valuation, occupied a very considerable amount of time, although the problem was not considered from a party point of view.
The passage of my right hon. Friend's proposal at that time did not take place without adequate discussion, and I do not think hon. Members opposite can say that, at the present moment, we are not devoting our time to the discussion of a very vital matter affecting London, and a question which has raised controversy in many other parts of the country. On the last occasion when the late Government dealt with this matter my right hon. Friend the Member for Edgbaston undertook to bring in a separate Bill, and, if that course had been adopted and a fresh Bill had been brought in, we should have had all the privileges afforded by a Committee stage and a Report stage. In these circumstances, I do not think anyone can complain about the amount of discussion which is taking place when this subject is being dealt with in a single Clause, because this vital matter should be adequately discussed.
The first observation I want to make is about the proposals of the late Government, which were alluded to very fairly by the Financial Secretary. The original proposal which was made by my right hon. Friend the Member for Edgbaston in the Rating and Valuation Bill of 1925 was to bring about a single valuation through out the country, and during the later stages of that Measure there was a considerable amount of discussion in many parts of the House on this very question. That will show that, at any rate, the Government in those days were prepared to listen to criticism. Our original proposal was that of a single valuation for
the whole country. The most curious part of the speech of the Financial Secretary this afternoon has been that, while he is proposing to alter the system of valuation, and to depart from the single valuation; he has not been able to quote a single authority, either governmental or municipal, in favour of his proposal. It is certainly very astonishing that in introducing a proposal which upsets a system which has been in operation for over 50 years, he is doing so in the teeth of every recommendation of every commission appointed by any Government, and any recommendation which has ever been made by local authorities. The proposals of the Government go in the teeth of every one of those recommendations. Therefore, the right hon. Gentleman is taking a very serious step and incurring considerable responsibility.
I will take, for example, the very important recommendation of the Royal Commission on Imperial and Local Taxation. The recommendations of that committee are surely relevant to this discussion, and the Financial Secretary ought to pay some regard to them I think we should be informed, not in vague and general phrases, but precisely why it is that the Government are refusing to accept any of the recommendations of that important commission. What do they say? They say:
A general desire his been expressed by most of the witnesses, and in a number of resolutions which have been forwarded to us by public bodies, that it is desirable to have one valuation authority, and one system of arriving at valuations for the whole rating area over which common rates are raised.
That is the unanimous recommendation of the Royal Commission on Imperial and Local Taxation, and they have made that recommendation, not simply on their own responsibility and initiative, but because there is a general desire among the witnesses who appeared before them, and expressed in the resolutions which they have received from public bodies, to have one valuation authority.

Sir K. VAUGHAN-MORGAN: What is the date of that report?

Sir K. WOOD: It is a recommendation made by the Royal Commission on Imperial and Local Taxation in 1901. I do not think the Financial Secretary will challenge those recommendations in respect of the year in which they were
made, because that Commission was expressly set up to deal with questions of this kind.

Mr. MILLS: We are now dealing with this question nearly 30 years after that date.

Sir K. WOOD: The point I want to emphasise is that that body, which was appointed by the Government, reported unanimously in favour of one valuation. A Departmental Committee on Imperial and Local Taxation was set up in 1921, and I would just like to quote a sentence from the evidence of a gentleman whose authority will not be questioned. It is the opinion of a distinguished surveyor speaking on behalf of the professional body to which he belonged. This is what Sir Henry Trustram Eve said on this point:
We are unanimous in thinking that we want one rateable value for rates and taxes, and we took a leading part in the Bill of 1905.
That was the opinion held when this matter was before Parliament in those days. Sir Henry Trustram Eve went on to say that he went to a former President of the Local Government Board, Mr. Long, and put before him this contention, and he also produced a memorandum in which he stated that there were five rates and taxes, which had different totals, which might be presented to the ratepayers. This gentleman told the Committee how much his association had pressed upon the Government of the day the desirability, in the public interest, of having one valuation. Every commission which has been appointed by this House, and a Departmental Committee, as well as an important body representing professional men who have had a great deal of experience of the working of this Act up and down the country as well as in London, are strongly of the opinion that there should be one valuation. It is a very astonishing thing that, with the exception of the vague general phrases offered to us by the Financial Secretary this afternoon, and the statement that at the present time there is a considerable loss of revenue, no reason has been given as to why the Government have rejected the recommendations of those who were appointed to inquire into this matter, and who from a professional paint of view have to know the most about it.
As far as my memory goes, I think it was largely as a result of the recommendations of those responsible bodies that the Government of 1925 introduced in their Bill the main principle of having one valuation. It does seem to me that there is a good deal of common sense and reason why that recommendation was made by the Royal Commission and the experts who gave evidence before that Commission. I think it is a very strong thing for the Government to go in the teeth of such strong evidence in favour of one valuation.
I desire to refer to the speech of my hon. and gallant Friend the Member for East Fulham (Sir K. Vaughan-Morgan). It is not the first time that he has spoken on this matter, and on occasion—I do not want to put it too high—even he has not spoken in the certain terms that he has used this afternoon. When my right hon. Friend the Member for Edgbaston introduced his Bill, and proposed one valuation for the country, bringing it into line with London, the various representatives of the local authorities in London met, as one would expect, and deliberated on the proposal; and what did they say? I only quote this in order to displace, if I can, the very effective and able speech of my hon. and gallant Friend the Member for East Fulham, which certainly does not represent the view, so far as London was concerned, that was expressed to my right hon. Friend the late Minister of Health. In January, 1924, when this proposal of a single valuation for London and for the whole country was in the Bill of the Conservative Government of that day, the Metropolitan Boroughs Standing Joint Committee met and considered whether that proposal was a wise one; and what evidence did they put before my right hon. Friend the late Minister of Health? Did they say, as ray hon. and gallant Friend the Member for East Fulham has said this afternoon, that it was a most unfair and unworkable proposal, bringing ruin in its train? They said exactly the contrary. They made a report, which they sent to the Government of that day, and in which they said:
That system"—
that is to say, the system which the present Government are endeavouring to upset so far as London is concerned—
has worked well in London for over half a century.
They did not content themselves with that, but they went on to say that they had every reason to be satisfied generally with the working of the Valuation (Metropolis) Act, 1869, though there were some minor amendments which they would like to see made. What greater tribute could there be to the system of a single valuation in London, what more considerable answer could there be to the statement of my hon. and gallant Friend, when the people who, at any rate, ought to have some knowledge and experience of the Act, said that it had worked well for 50 years, and that they had every reason to be satisfied with the working of this particular Act which my hon. and gallant Friend has condemned so severely? Therefore, it comes to this, that the Government——

Sir K. VAUGHAN-MORGAN: May I remind my right hon. Friend that the case for the Government's policy was put in different terms from those which he has quoted?

Sir K. WOOD: Certainly, it was put in different terms. There is no need for me now to criticise or go back on the whole matter, but, although it was put in different terms, their experience of the working of the Act in London, their testimony of 50 years to the principle of a single valuation, could not possibly be displaced. Therefore, to-day we find ourselves in this position that the Government are seeking to displace a system which the Standing Joint Committee supported; and I may say, for the benefit of those hon. Members who are not acquainted with it, that the Standing Joint Committee is in no sense a political body, but includes all kinds and types of people who serve London municipally. It is elected from men who have done excellent service for London on the borough councils. It is not a question of Socialist or Tory, or anything of that kind. The whole of these men came to the conclusion that this system was working splendidly, and yet this afternoon we find the Government advancing a proposal which is not only against the recommendations of the Royal Commission, which is not only against the recommendations of the surveyors of the country, but is actually directed against the experience and
desires, as I understand them and as they are explained in this memorandum, of London itself.

Sir K. VAUGHAN-MORGAN: No.

Sir K. WOOD: My hon. and gallant Friend will have to make another speech to explain how he can possibly vary a very definite undertaking and declaration of that kind. There is no doubt that, from the point of view of London and the working of this particular Act, there has been little or no criticism which anyone could direct at its general principles. It is perfectly true that, as my right hon. Friend the Member for St. George's (Sir L. Worthington-Evans) said a little while ago, one might desire to see it amended here and there, but that is a criticism to which any system that has gone on for 50 years must be subject; but, taking it as a whole, you find that this system of a single valuation in London has been working to the satisfaction of the representatives of London, as they declared, at any rate, in 1924.
I have endeavoured to follow the speech of the Financial Secretary, and I do not think he will say that I am doing him an injustice when I say that the only reason which he has advanced, or, at any rate, the principal and main reason which he has advanced, for this change, is what he alleges is the loss of revenue to the country. I must observe that he has only supported that statement by some very vague reference to some very rough estimate. I gather—the hon. Gentleman must correct me if I am mis-stating the position or misinterpreting him—that his estimate of loss of revenue conies from Somerset House, a very strange quarter to give such an estimate. If it be the case, as Somerset House alleges, that under this system, which has been in operation for so many years, there has been a loss of revenue, I want to know what the Inland Revenue representatives have been doing all this time. The Financial Secretary will certainly not dispute that they have at any rate sufficient powers to bring cases of improper assessments or valuations or the like before a proper tribunal, and it is very astonishing that, after all these years, this statement should be made without any evidence beyond a vague allegation from the very people who have duties imposed upon
them by Statute, and who have never at any time, so far as I know, asked any Government or any Minister to come to the House of Commons and suggest any method of giving them further powers for putting a matter of that kind right.
When this very grave charge is made concerning London, and when it is only supported by a vague allegation of this kind, we are entitled to ask why, if it be true, no steps have been taken by any Government, Conservative, Coalition or Labour, to arm the authorities with proper powers and to prevent this loss which they allege has been going on for so long a time. I must say, with every respect to the view which the Financial Secretary has put forward, that I cannot regard a statement of that kind as sufficient to displace the recommendations of every commission and every tribunal that has inquired into this matter, and to displace the general judgment of the representatives of London.
The matter is a serious one, and I put forward this argument on public grounds. I have no desire to aid anyone to avoid the payment of their proper dues; for selfish reasons alone one would not desire to do that, because it only means the imposition of more burdens upon people who do wish to fulfil their obligations; but a very serious alteration follows as a result of this new system which is being set up. Undoubtedly—and this is a point with which the Financial Secretary did not deal at all—the position of the taxpayer is very seriously affected so far as his rates are concerned. I could understand it if the Financial Secretary were coming forward with this proposal and preserving to the taxpayer some of the rights of appeal which he has at the present moment, or were bringing forward some fresh proposal which would put him in the same position in which he is at the present time. My hon. and gallant Friend the Member for East Fulham skated very quickly over that aspect of the matter. I have no doubt that he has great faith in the general commissioners of Income Tax, and quite naturally so, as he is one of them himself. Indeed, if I myself had to deal with my hon. and gallant Friend, I should feel the utmost confidence. But, after all, in this country we do desire to preserve the free access of our citizens,
and particularly as regards questions of payment of taxes, to the courts.
It is perfectly true, as my hon. and gallant Friend has said, that, on a legal question, if you can get the general commissioners to state a case, you might then possibly be able to go to a Court of Law. My hon. and gallant Friend knows far more about this matter than I do; it is a long time since I had to deal with the practical side of this matter; but I think that every lawyer in the House knows the difficulty of getting a case stated, and the dangers, from the point of view of the citizen, of a case stated. As far as I can recollect, you have to rely upon the tribunal itself as to how that case can be stated, and the alteration of a phrase or the addition of a sentence or two by the tribunal, whose decision itself is attacked, may make all the difference, when you go to a judicial tribunal, as to what particular matter you have to argue and what the result will be. Therefore, I do not regard it as at all satisfactory, or as being at all a security to the taxpayer, that he can by some means or another get a legal decision on a matter arising before the general commissioners. In any event, he certainly loses his right, which he possesses at the present time, of going to the court on a question of fact, and that is a very serious loss. I speak as one who is in no way affected by any party side of this matter. I have heard the matter debated very often; I have sat through very many sittings, and have heard speeches upon it from all quarters of the House; but I must say that I feel bound to come to the conclusion, especially after reading the evidence given before the Royal Commission, and knowing what the individual citizen is losing, and how the whole of this case is based merely on an allegation of loss of revenue, that this is a retrograde step so far as London is concerned, and I shall vote against it.

Major NATHAN: The right hon. Gentleman speaks with unrivalled authority upon the whole question of rating in London, and I cannot presume to follow him throughout his speech, but, as a London Member, I feel myself under an obligation to draw attention to some very remarkable features with regard to this Clause. Not the least remarkable is that it should have been, so to speak, by
accident slipped into the Finance Bill as a sort of unconsidered trifle, a Clause which in a few lines would revolutionise the whole system of valuation for rating and taxation in London. The fact that it has operated for upwards of 60 years is no reason why it should not be altered, but it is a reason why it should not be slipped into a Bill which deals with very different matters and has a very different purpose, and it is a reason why the fullest possible explanation should be given why this proposal is placed before us. Another remarkable feature is that the Financial Secretary has informed us that the real objective is to gain for the Revenue tax which it is believed is now being lost. But this is introduced merely as an administrative Clause. The hon. Gentleman has said it is in effect a taxing Clause, but when the Chancellor of the Exchequer opened his Budget he said nothing about a further tax. He introduced no Financial Resolution. I am not suggesting that it was technically necessary to do so, but far from drawing attention to the fact that the main object was to obtain more tax, he said there would be
a new assessment of all property in Great Britain for Income Tax Schedule A. This will come into force next year and will include the Metropolis. In the Metropolis valuations for Schedule A are linked up and dependent on the valuations made for purposes of rating. I propose to alter this and to provide for a separate valuation for Schedule A as distinct from the rating valuation."—[OFFICIAL REPORT, 14th April, 1930: col. 2675, Vol. 237.]
There is nothing there about gaining revenue which has been lost, but merely a reference to a search after uniformity. The Financial Secretary rather indicated the view that the result of the change that is proposed would be that tax would be paid upon the actual rent received, and in that way loss of revenue would be avoided. It would be a profound misunderstanding of the legal position to believe that a valuation made for Income Tax purposes is anything but an artificial valuation, and it is just as little likely to be the actual rent received by the landlord as the present valuation. It simply means duplicating the machinery.
Reference has been made to the effect of the adoption of this Clause as re-
gards appeals. In these days, when government is necessarily and properly coming more and more into the hands of experts, one of the chief functions of the House of Commons is to protect the citizen against the encroachments of the executive. I look with the gravest suspicion upon any proposal whereby the executive will bar the road to the courts to the citizens of the country, and I believe this Clause, intentionally or otherwise, but inevitably, will have the effect of preventing the subject from having that recourse to the courts which has been his safeguard through so many generations. For that reason alone, I should find myself unable to support it. Then the Financial Secretary has said he welcomes this proposal as being a step in the direction of uniformity. Why this worship of uniformity? And, it uniformity, why not uniformity of the provinces with the tried system of London, instead of an alteration of the system of London to bring it into line with the new proposals for the provinces? Uniformity is all very well in its proper place, but there is no uniformity between things which are not themselves uniform, and there is no uniformity between this great aggregation of 6,000,000 or 7,000,000 of thickly congested, highly industrialised population and the relatively scattered communities outside. Uniformity is a misleading slogan in reference to this proposal.
The proposal for single valuation, not for London alone but for the whole of the country, has constantly occupied the mind of Parliament. Any number of Government Bills have been introduced during the last 60 years for the express purpose of securing a single valuation. Bills were introduced in 1867, 1869, 1876, 1877, 1878, 1879 and 1904. They all failed except that of 1869, which applies to London. When its useful effect had been discovered, attempts were made to bring the rest of the country into line, but they failed for the rather curious reason indicated by the hon. Member for East Fulham (Sir K. Vaughan-Morgan). There is really a sort of rivalry going on in London, a clash between the Inland Revenue authorities and the rating authorities, and in London in particular we are experiencing once again in this controversy painful evidence of the long-drawn disputes and quarrels between the
county council and the borough councils. The standing committee of Municipal Borough Councils has expressed its opinion in no uncertain terms. But it is not left with the joint standing committee. In the report of the Royal Commission on Imperial and Local Taxation in 1899 Mr. Gomme, the statistical officer, afterwards Sir Laurence Gomme, the distinguished clerk to the London County Council, states:
The Metropolis Valuation Act, 1869, had the effect of bringing up the assessments of the Metropolis to a much higher standard than that existing in the rest of the country.
The Commissioners in their Report say:
Other witnesses, although advising the amendment of the Act in certain details, have recommended that its general principles should be extended to the rest of the country.
In paragraph 117 they use these words:
The advantages of these provisions have been recognised by various witnesses who, as already stated, have recommended their extension to other parts of the country.
6.0. p.m.
In paragraph 120, referring to the attempts made to improve the system of valuation, they point out that the defects in the system of valuation referred to in the report have been recognised for a number of years and various Acts of Parliament have been passed, and they refer to the Metropolis Valuation Act, 1869, which they say embodied a number of suggestions which have been made in various Bills brought into Parliament, the most important of which have already been referred to in the paragraphs to which I have directed attention. They say in paragraph 157:
We entirely concur in the suggestions which have been so frequently made that it is desirable to have only one valuation in each area on which rates and taxes for all purposes should be raised. Such a system would minimise expense, trouble and inconvenience and would further result in uniformity in the valuation of the same classes of property throughout the same area.
Their very first recommendation was that there should be only one valuation authority in each county, and the valuation list of that authority should be the basis upon which rates and taxes for all purposes should be raised. There is nothing there about difficulties in working, nothing about loss of Income Tax and nothing about the advantages of separate valua-
tion. The report counted amongst its signatories one who then signed himself C. A. Cripps, better known to us under the name of Lord Parmoor, a member of the present Cabinet. The proposal for a single valuation therefore has, or had, the support of a member of His Majesty's present Government, and I now ask the Financial Secretary to direct his attention to paragraph 444 of the Report of the Royal Commission on Income Tax which was signed in 1920. They say:
We may refer to the expediency of having one valuation for national and local purposes in England and Wales outside the Metropolis. We find the system works well in the Metropolis, and, though we have not taken evidence that will justify us in making a definite recommendation, we think the proposals for a general valuation for the purpose referred to should receive serious and sympathetic consideration.
But the Government, instead of giving serious and sympathetic consideration to the report of this powerful Commission, of which the present President of the Board of Trade was a member and signed the report, take a course exactly contrary to that recommended. The Financial Secretary may say, "Ah! but what about the tax which may be lost?" Provision is made for the collection of that tax, first, by the dictates of common sense, and, secondly, by the recommendations made by the Royal Commission on Income Tax and also by the Standing Joint Committee of the Metropolitan borough councils. In a case where tax is assessed on a less amount than the rent actually received—and I am sure the Financial Secretary will deal with this point—the Royal Commission suggest, as I think common sense dictates, that the excess rent should be chargeable on the owner under Case 6 of Schedule D. If that course were adopted—again, a course to which his right hon. colleague the President of the Board of Trade has subscribed—you would not have tax paid on an artificial valuation, but upon the actual rent received.
I have only one other document to, which I desire to direct the attention of the Committee. I have referred to the report of the Royal Commission on Imperial Taxation of which the Lord President of the Council was a member, to the report of the Royal Commission on Income Tax of which
the President of the Board of Trade was a member, and I have searched the records of the Royal Commission on Local Government and the committee which sat recently upon the Government of London, in neither of which can I find any reference to this subject. But in the debate upon the Rating and Valuation Bill, introduced by the late Government, for Second Reading on 13th May, 1925, I have found a speech which was made on behalf of the then Opposition and now the Government Party by the present President of the Board of Education. Speaking upon the Bill, which was introduced by the then Minister of Health, he said:
It is good that the valuation will now be under the control of the most effective and the most democratically chosen authorities of the country. It is good that the valuation for local purposes will be linked up with national taxation, and that the Income Tax Commissioners will help to make the assessment"—
and I direct the attention of the Financial Secretary to these words which were used by his colleague the President of the Board of Education:
which is to be used for local and taxing purposes alike."—[OFFICIAL REPORT, 13th May, 1925; col. 1893, Vol. 183.]
I challenge the hon. Gentleman to point to a single authority during the last 60 years, whether it be a Resolution of this House, the report of any Royal Commission or Departmental Committee, or the resolution of any professional body, in favour of the course which the Chancellor of the Exchequer is now proposing.

Mr. ATKINSON: The case in support of this Amendment can be put in a nutshell. The valuation of land and property is required for two purposes—one, rating; the other, revenue. But for both these purposes the same value has to be arrived at. The Financial Secretary said that the immediate objective was not the same. I challenge that statement absolutely. The valuation may be different, but the immediate objective, the ascertainment of value, is precisely the same in rating law and in revenue law. It is expressed in practically identical language. You have to arrive at the sum which the property is worth to be let by the year, the rent a tenant might reasonably be expected to pay. In both cases the simple
question of tax which you are trying to ascertain is precisely the same. The first observation one makes is, surely the tendency of modern times ought to be towards simplicity, and not away from it. When you want to ascertain a simple fact, namely, a fair valuation, surely common sense would say that there should be one procedure for ascertaining that value, whatever purpose is going to be made of the value. After all, the value cannot change because of the purpose to which you may put the figure you have ascertained.
Under the Act which you are seeking to repeal, you have a procedure which has been worked for 60 years for ascertaining that simple question of fact, the value fixed by the overseers, with appeals to special sessions and to general sessions which can be made by the surveyor of taxes in the same way as by the person taxed. If the result is not satisfactory, if it is such that to-day's values are not fair, anyone can blame the surveyor. It simply means that he has not exercised the legal rights given to him by the Act. The Act provides for quinquennial valuations, and in that respect it provides what the Financial Secretary is trying to do. If the method there laid down is not satisfactory, and experience has shown that it does not give fair value, change the method by all means, but you must change it for both purposes. Have one method instead of two.
What will be the result from the point of view of the taxpayer? You are going to say to him, if the Clause is passed, that for rating purposes he shall fight the question of the value of his land under the Act of 1869. He might take his assessment to special sessions or to general sessions and he might establish that the figure he had was fair, but when he had done that, the fight would be only half complete. You have to deal with the Revenue authorities. If they are valuing your property too high, you will have to fight the matter all over again with the surveyor of taxes, not before any legal tribunal but before a special tribunal, or, in other words, the general commissioners—a very different tribunal, armed with the power—which I expect, if we knew the truth, was the whole reason for this Clause—that if an appeal against assessment in Schedule A or Schedule B arises as to annual value,
the general commissioners may direct the appellant to cause the valuation to be made by a person of skill, and may require the same to be valued on oath and the annual valuation determined in accordance with that valuation.
If you appeal to the commissioners, you are faced with this fact. The general commissioners may say, "Well, you shall have a valuation made by Mr. A.B. and the valuation Mr. A.B. determines ends the case.' That is a very harsh weapon. In other words, he is taken from a court of justice and his case is determnied by a valuer who has not been agreed to by him, as would be the case in other arbitrations. Valuers are human, and general commissioners, I suppose, are human. The valuers, I suppose, may think, "Well, if we put on too low values, we shall never get nominated again for this job." At any rate, it is a very unsatisfactory weapon to leave in the hands of a tribunal, and one which the ordinary appellant does not like at all. It takes him right away from courts of justice determined on evidence of valuers and witnesses who can be cross-examined, to someone nominated by the tribunal, and he has no method of cross-examining or of saying that the valuation is wrong or that they have overlooked this, that or the other fact. You are bound by that decision and may have to pay the cost of valuation if it is higher than the figure which you feel it should be.
The ordinary landowner or houseowner is being faced with a dual fight. He has to fight one authority before one tribunal, and even if he wins and gets his appeal established, it is no help to him for he has to fight over again. That is entirely unscientific. If you are going to make a change at all, it ought to be made throughout the country in the direction of London, and not changed in London in the direction of the rest of the country. It is a simple question of fact as to what a property is worth let per year. It is not a difficult thing to ascertain. If the tribunal which you have has not ascertained the figure fairly, and the appeal tribunal and general sessions in practice do not arrive at a fair result, change your method and procedure for both purposes. If it is not a sound system, why retain it at all? There ought to be one method—and one method only—in arriving at this simple annual value of property and land, a value which can be
used for all purposes. Value cannot change because of the purposes for which it is going to be used. As a result of this dual authority two valuation lists may contain different values. If they are to arrive approximately at the same result, all this extra expenditure will have been wasted. If they are to arrive at different results, your authorities will be working on two different valuation lists. One must be unfair either to the taxpayer or to the authority.
What will be the feeling created in the mind of the owner of the land or house? He will always think that he is being unfairly treated, that this authority or that authority is attributing to him for land or buildings a higher value than the other authority. They both cannot be right. It will tend to create a good deal of dissatisfaction in that way, and it will strengthen the demand for some form of uniformity, because everybody who looks at the matter scientifically, or wants to ascertain the value in a fair and impartial way, must surely feel that the right way to deal with it is to have one valuation arrived at in a way which will be satisfactory to everybody. Let us have one method, and one method only. Do not let us create procedure of this sort which, if it makes any change at all, will create two valuation lists which must differ one from the other. If the lists differ, you inevitably create a feeling that one list must be wrong. I submit that it is sound and scientific to retain one method only.

Mr. PETHICK-LAWRENCE: We have had 2½ hours' discussion, and I would appeal to the Committee to come to a decision.

Major ELLIOT: We are here discussing the revaluation of almost a kingdom, affecting 4,500,000 people, over £76,000,000 of gross value under Schedule A, and 857,000 assessments. Therefore, 2½ hours is not an unreasonable length of time to devote to such a subject.

Captain Sir WILLIAM BRASS: Another thing which we are doing is trying to repeal an Act of Parliament which has been in existence 61 years.

Mr. RAMSBOTHAM: The hon. and gallant Member for North-East Bethnal Green (Major Nathan) asked why this Clause had been inserted, and expressed surprise at its insertion. He did not
need to express surprise. It has been inserted solely for the purpose of getting money. Judging by the rest of this Bill, the Government are prepared to insert any Clause, however incongruous, for that purpose. The Financial Secretary has the spirit of acquisitiveness which permeates his Department. Can he give us any evidence why valuations which are fair for rating are unfair for Income Tax? I understand that the Inland Revenue officer can always, if he chooses, be a party to appeals on rating questions, and can express his dissatisfaction with assessments, if he so chooses. I do not ask for the information to be given immediately, but perhaps the Financial Secretary can let us know later how many occasions in the last year or the last two or three years the Inland Revenue officer has appealed against an assessment in London, and has expressed his dissatisfaction. If he has not appealed, ex hypothesi he is satisfied with the assessment. If he has appealed, it would be interesting to have the details and to know how often he has appealed, and with what results.
The hon. and gallant Member for North-East Bethnal Green said that apart from the question of raising £500,000 there could be no justification for altering a system which has worked perfectly well in London and which, on the face of it, is a businesslike system, a common-sense system and easier of administration and which, apart from financial considerations, no one would dream of altering. It would have been left unaltered except for the purpose of raising the wind—raising the revenue. The country would much prefer to have the London system rather than vice versa. The question of the expense may not be very important, but £15,000 has been mentioned. In view of the figures given by the hon. and gallant Member for Kelvingrove (Major Elliot), I doubt whether the change can be made at a cost of £15,000. Perhaps the Financial Secretary will be able to tell us how many additional officials will be necessary; how many valuers will be required to do the valuation. Unemployment cannot be cured merely by appointing fresh valuers. I should like the Financial Secretary to tell us whether valuation for Income Tax is higher than
the valuation for rates, and if so, what is the explanation. Why does he expect to get another £500,000 from this change because, theoretically, the valuation for one, if carefully done and not appealed against by the Inland Revenue officer, should be identical with the other?

Sir ASSHETON POWNALL: I have a special interest in this question, an interest greater than that of any other hon. Member, not because I am the largest landowner in London—I wish I were—but because I represent the largest constituency in the whole of London. Therefore, my constituents are more affected than the constituents of any other London Member or of any other hon. Member. That is why, in response to the appeal of the Financial Secretary, I can promise him that my arguments shall be as few as my 77,000 constituents are numerous. No real justification has been made for putting this extra infliction upon householders in London. We all know the difficulties that arise in filling up the very complicated forms in connection with Income Tax. For years past we have had one form in London every five years from the rating authority, and we are now threatened with a second form every five years. That may seem in itself a small matter, but throughout the whole of London it means that 1,000,000 forms will be issued every five years to the ratepayers of London. That is a very big administrative task for those who have to deal with the forms, and it means considerable expense. I do not think we have been given any figures in regard to the administrative cost, but there must be very considerable administrative machinery to be set up in London to deal with the sending out of the forms and to deal with them when they come in, and also to deal with the appeals. From that point of view the Financial, Secretary has not made out a very good case. He says that an additional £500,000 will be obtained. Is that a gross or a net sum? Does it include the cost of the administrative machinery, or is it £500,000 after the administrative machinery has been set up? It might cost tens of thousands of pounds to collect the £500,000.
Years ago I served as a member of a borough council and I know the amount of time that was given by my colleagues of the council in connection with their duties arising out of the valuation. It
is news for me to know that that work has not been properly done. I do not say that in every case it was a fair valuation, for there must be differences of opinion, but are we to sweep away the whole of that system or set up alongside it another system, with the possibility that the borough council may say that £100 is a fair valuation for a certain property and the Inland Revenue may put the figure at £120, with the result that the borough council valuer next year may put the figure at £120? If this sort of thing is to go on every time, with two authorities each putting up their valuation against the householder, it will mean that at intervals of two or three years the unfortunate householder will find himself hit, and he will be hit for the rest of his life in respect of any property that he owns. That is not a reasonable suggestion. I do not think that the case has been made out sufficiently for a change in the existing system. If there are cases where property which ought to be valued at £1,000 has only been valued at £500, and the Inland Revenue has lost money, we ought to be told of such cases, which would strengthen the case put forward by the Financial Secretary; but unless much better argument can be made than has been made, I shall be justified in voting against the Clause.

M. A. M. SAMUEL: I should like to put two or three Treasury questions. The Chancellor of the Exchequer and the Financial Secretary have justified themselves on the ground that they are not getting the revenue that they ought to get. We have been told that it will cost £15,000 for this extra valuation. How can they justify that estimate of £15,000? Let us take the average salary of the competent men who deal with valuation. In this case it is proposed practically to revalue a nation. The administrative county of London contains a population as large as that of Canada, with tens of thousands of houses, and we are told that the cost for the revaluation will be £15,000. That would mean 15 officials without any expenditure allowed for overhead or charges other than salaries. I do not want to be rough in my expressions of opinion, but I must say that I do not believe it. I do not believe that it can be done for any such sum. I do not think that sum represents one-tenth or one-twentieth of the expense involved. I hope that my hon.
Friend will press the point and ask the Financial Secretary to prove that the cost will be only £15,000. I am not doubting his word, but I do not believe in the accuracy of the calculation.
Apart from the expense, there is the question of worrying and harassing the taxpayer, and then there will be the appeals. Moreover, there is the insinuation in this Clause that all the competent, honourable and devoted men who work on the various municipal corporations and assessment committees, who have done this public work of assessment, have all along been assessing unfairly. Supposing that I live in a property which is assessed at £200, are we to understand that those who have assessed me in Marylebone have been incompetent to do the work and have under-assessed me and put me in a, position of unfair privilege as against my fellow-taxpayers? I do not believe it. I believe that the competent people on the borough councils are quite able to do the assessments, and I am not prepared, without better proof than has been given, to accept the idea that the assessments have been inaccurate and unjust and all in favour of the taxpayer.

Mr. PETHICK-LAWRENCE: I will answer the hon. Member for Farnham (Mr. A. M. Samuel) at once. It is estimated that the cost will be £15,000 for each valuation, and that the additional revenue will be £500,000 each year.

Sir A. POWNALL: Does that include the cost of the appeals?

Mr. PETHICK-LAWRENCE: Yes.

Major ELLIOT: I had hoped that the Financial Secretary might have dealt at greater length with the very powerful case which has been advanced by hon. and right hon. Members on this side. He has answered at once the points raised by his predecessor in office, but if explanations can only be elicited by an ex-Financial Secretary of the Treasury, debate will be seriously limited. I wish to deal with the one particular point on which the Financial Secretary based a great deal of his case. He said that this double valuation was found to be necessary, and he defended it as an end in itself, as a good thing and as a procedure which should be followed. Let me point out that in the northern part of the United Kingdom the double valuation
does not apply, but the Financial Secretary does not propose to sweep away the single valuation as regards Scotland.

Mr. SHERWOOD: Having regard to the fact that Englishmen are not allowed to intervene on Scottish matters, is it in order for a Scottish Member to intervene on English matters?

The DEPUTY - CHAIRMAN (Mr. Dunnico): I have frequently ruled that hon. Members do not sit in this House as Englishmen, Scotsmen, Welshmen or Irishmen, but as Members of Parliament.

Mr. CHARLES WILLIAMS: Are we to understand from your Ruling that English Members have a perfect right to intervene in Scottish debates and that Scottish Members have a right to intervene in English debates?

The DEPUTY-CHAIRMAN: The hon. Member, if he has any doubts on that matter, may dispel them.

Major ELLIOT: May I point out to the hon. Member for Wakefield (Mr. Sherwood) that we are dealing with questions of general revenue, which is contributed to by those north of the Tweed as well as by those south of the Tweed. The Financial Secretary has defended the double valuation as a good thing in itself, and in doing so went counter to many of the committees and commissions which have considered this matter. They have said that it is not necessary, and surely it is not outside his knowledge that in Scotland it is not necessary and that the one valuation there is accepted for both purposes. It has worked perfectly satisfactorily. If the local authority appoints the Inland Revenue officer for the purpose of local valuation then the valuation is accepted by the Inland Revenue for the purposes of Inland Revenue. It is a statutory acceptance. It is not proposed to sweep away the single valuation in Scotland as in the case of London. When the Financial Secretary said that the double valuation has great merits and that the single valuation creates great injustices I became somewhat apprehensive that the northern part of the kingdom may be being treated unfarily at the moment. Obviously, it will affect Scotland very closely, because a similar Amendment will have to be in-
troduced in regard to Scotland. We shall oppose it. Anyone who has had any experience of the working of the admirable system in Scotland, where the relations are good and where annual valuations are carried out by which violent bumps and slumps are avoided, consider that we are ahead of the system which prevails in England.
The Government propose to sweep away a good system and replace it by a bad one. That requires a certain amount of answer. The case made out by the Financial Secretary was traversed by many hon. Members on this side of the Committee and by hon. Members of the Liberal party, but the Financial Secretary has given us no reply. He has given us his own case but has not attempted to answer the case which has been made out from this side of the Committee. There is the precedent in this Bill of the single valuation being left in the case of Scotland, although it is proposed to sweep it away in the case of London. In Scotland the same officer carries out the single valuation and it is most acceptable both to the Inland Revenue authorities and to local authorities. It is a statutory duty to accept that valuation. Although it is optional on local authorities to appoint the Inland Revenue officer as their valuer it is nevertheless interesting to find that more than 50 per cent. have chosen to appoint him. The system is working well, and it forms a very valuable analogy to the system in London which it is proposed to sweep away. The revaluation of this enormous block of property represented by Schedule A valuations of London deserves a close and careful examination. It affects £76,000,000 revenue, 857,000 assessments, and a population of 4,500,000. If the financial affairs of Scotland were dealt with in any such brief and perfunctory manner I am certain that Scottish Members would demand the presence not merely of the Chancellor of the Exchequer but of the whole Treasury bench, and would expect not an appeal for the closing of the debate but for a full and exhaustive analysis of the revenue proposals, which they would not allow to be dismissed without very careful examination.

Mr. PETHICK-LAWRENCE: rose in his place, and claimed to move, "That the Question be now put."

Question put, "That the Question be now put."

The Committee proceeded to a Division.

Mr. MARJORIBANKS (seated and covered): On a point of Order. May I ask whether you were aware that the Chancellor of the Exchequer said that he would give us the fullest and frankest discussion on this matter and place no limit upon it whatever? If

you had been aware of this, may I ask whether you would have allowed the discussion to be closed?

The DEPUTY-CHAIRMAN: The Chair is not affected by an alleged pledge given by any hon. Member. I have to use my discretion, as to whether reasonable discussion has taken place, and I have done so in this case.

The Committee divided: Ayes, 256; Noes, 166.

Division No. 383.]
AYES.
[6.38 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Gill, T. H.
Lowth, Thomas


Adamson, W. M. (Staff., Cannock)
Gillett, George M.
Lunn, William


Addison, Rt. Hon. Dr. Christopher
Glassey, A. E.
Macdonald, Gordon (Ince)


Aitchison, Rt. Hon. Craigie M.
Gossling, A. G.
MacDonald, Rt. Hon. J. R. (Seaham)


Alexander, Rt. Hon. A. V. (Hillsbro')
Gould, F.
McElwee, A.


Ammon, Charles George
Gray, Milner
McKinlay, A.


Arnott, John
Greenwood, Rt. Hon. A. (Colne)
MacLaren, Andrew


Aske, Sir Robert
Grenfell, D. R. (Glamorgan)
Maclean, Sir Donald (Cornwall, N.)


Attlee, Clement Richard
Griffith, F. Kingsley (Middlesbro' W.)
MacNeill-Weir, L.


Ayles, Walter
Griffiths, T. (Monmouth, Pontypool)
Macpherson, Rt. Hon. James J.


Baker, John (Wolverhampton, Bilston)
Groves, Thomas E.
McShane, John James


Baldwin, Oliver (Dudley)
Grundy, Thomas W.
Malone, C. L'Estrange (N'thampton)


Barnes, Alfred John
Hall, F. (York, W. R., Normanton)
Mansfield, W.


Barr, James
Hall, G. H. (Merthyr Tydvil)
March, S.


Batey, Joseph
Hall, Capt. W. P. (Portsmouth, C.)
Marcus, M.


Bellamy, Albert
Hardie, George D.
Marley, J.


Benn, Rt. Hon. Wedgwood
Harris, Percy A.
Marshall, Fred


Bennett, Capt. Sir E. N. (Cardiff C.)
Hartshorn, Rt. Hon. Vernon
Mathers, George


Bennett, William (Battersea, South)
Hastings, Dr. Somerville
Matters, L. W.


Benson, G.
Haycock, A. W.
Messer, Fred


Bentham, Dr. Ethel
Hayes, John Henry
Middleton, G,


Bevan, Aneurin (Ebbw Vale)
Henderson, Right Hon. A. (Burnley)
Millar, J. D.


Blindell, James
Henderson, Arthur, Junr. (Cardiff, S.)
Mills, J. E.


Bondfield, Rt. Hon. Margaret
Henderson, Thomas (Glasgow)
Milner, Major J.


Bowen, J. W.
Henderson, W. W. (Middx., Enfield)
Montague, Frederick


Bowerman, Rt. Hon. Charles W.
Herriotts, J.
Morgan, Dr. H. B.


Brockway, A. Fenner
Hirst, G. H. (York W. R. Wentworth)
Morley, Ralph


Bromfield, William
Hirst, W. (Bradford, South)
Morris, Rhys Hopkins


Brooke, W.
Hoffman, P. C.
Morris-Jones, Dr. J. H. (Denbigh)


Brothers, M.
Hopkin, Daniel
Morrison, Herbert (Hackney, South)


Brown, C. W. E. (Notts, Mansfield)
Hore-Belisha, Leslie
Mort, D. L.


Brown, Ernest (Leith)
Horrabin, J. F.
Moses, J. J. H.


Brown, Rt. Hon. J. (South Ayrshire)
Hudson, James H. (Huddersfield)
Mosley, Lady C. (Stoke-on-Trent)


Burgess, F. G.
Hunter, Dr. Joseph
Mosley, Sir Oswald (Smethwick)


Caine, Derwent Hall-
Hutchison, Maj.-Gen. Sir R.
Muff, G.


Cameron, A. G.
Jenkins, W. (Glamorgan, Neath)
Muggeridge, H. T.


Cape, Thomas
John, William (Rhondda, West)
Murnin, Hugh


Carter, W. (St. Pancras, S. W.)
Jones, F. Llewellyn- (Flint)
Nathan, Major H. L.


Charleton, H. C.
Jones, Henry Haydn (Merioneth)
Naylor, T. E.


Chater, Daniel
Jones, J. J. (West Ham, Silvertown)
Newman, Sir R. H. S. D. L. (Exeter)


Cluse, W. S.
Jones, Rt. Hon. Leif (Camborne)
Noel Baker, P. J.


Clynes, Rt. Hon. John R.
Jones, Morgan (Caerphilly)
Oldfield, J. R.


Cocks, Frederick Seymour
Jowett, Rt. Hon. F. W.
Oliver, George Harold (Ilkeston)


Compton, Joseph
Jowitt, Rt. Hon. Sir W. A.
Owen, H. F. (Hereford)


Cove, William G.
Kelly, W. T.
Palin, John Henry


Daggar, George
Kennedy, Thomas
Paling, Wilfrid


Dallas, George
Kenworthy, Lt.-Com. Hon. Joseph M.
Parkinson, John Allen (Wigan)


Dalton, Hugh
Lambert, Rt. Hon. George (S. Molton)
Pethick-Lawrence, F. W.


Davies, E. C. (Montgomery)
Lang, Gordon
Phillips, Dr. Marion


Day, Harry
Lansbury, Rt. Hon. George
Pole, Major D. G.


Denman, Hon. R. D.
Lathan, G.
Potts, John S.


Dickson, T.
Law, A, (Rosendale)
Price, M. P.


Duncan, Charles
Lawrence, Susan
Pybus, Percy John


Ede, James Chuter
Lawther, W. (Barnard Castle)
Ramsay, T. B. Wilson


Edmunds, J. E.
Leach, W.
Rathbone, Eleanor


Edwards, E. (Morpeth)
Lee, Frank (Derby, N. E.)
Raynes, W. R,


Egan, W. H.
Lee, Jennie (Lanark, Northern)
Richards, R.


Elmley, Viscount
Lees, J.
Richardson, R. (Houghton-le-Spring)


Foot, Isaac
Lewis, T. (Southampton)
Riley, F. F. (Stockton-on-Tees)


Freeman, Peter
Lindley, Fred W.
Ritson, J.


Gardner, B. W. (West Ham, Upton)
Logan, David Gilbert
Roberts, Rt. Hon. F. O. (W. Bromwich)


Gardner, J. P. (Hammersmith, N.)
Longbottom, A. W.
Romeril, H. G.


Gibbins, Joseph
Longden, F.
Rosbotham, D. S. T.


Gibson, H. M. (Lancs, Mossley)
Lovat-Fraser, J. A.
Rowson, Guy


Russell, Richard John (Eddisbury)
Smith, Tom (Pontefract)
Walters, Rt. Hon. Sir J. Tudor


Salter, Dr. Alfred
Smith, W. R. (Norwich)
Watkins, F. C.


Samuel Rt. Hon. Sir H. (Darwen)
Snell, Harry
Watts-Morgan, Lt.-Col. D. (Rhondda)


Sanders, W. S.
Snowden, Rt. Hon. Philip
Wedgwood, Rt. Hon. Josiah


Sawyer, G. F.
Snowden, Thomas (Accrington)
Welsh, James (Paisley)


Scrymgeour, E.
Sorensen, R.
Welsh, James C. (Coatbridge)


Scurr, John
Stamford, Thomas W.
West, F. R.


Sexton, James
Strachey, E. J. St. Loe
White, H. G.


Shaw, Rt. Hon. Thomas (Preston)
Strauss, G. R.
Whiteley, Wilfrid (Birm., Ladywood)


Shepherd, Arthur Lewis
Sutton, J. E.
Williams, Dr. J. H. (Llanelly)


Sherwood, G. H.
Taylor, R. A. (Lincoln)
Williams, T. (York, Don Valley)


Shield, George William
Thomas, Rt. Hon. J. H. (Derby)
Wilson, C. H. (Sheffield, Attercliffe)


Shiels, Dr. Drummond
Thorne, W. (West Ham, Plaistow)
Wilson, J. (Oldham)


Shillaker, J. F.
Thurtle, Ernest
Wilson, R. J. (Jarrow)


Short, Alfred (Wednesbury)
Tinker, John Joseph
Winterton, G. E. (Leicester, Loughb'gh)


Simmons, C. J.
Toole, Joseph
Wise, E. F.


Simon, E. D. (Manch'ter, Withington)
Trevelyan, Rt. Hon. Sir Charles
Wood, Major McKenzie (Banff)


Sinclair, Sir A. (Caithness)
Vaughan, D. J.
Young, R. S. (Islington, North)


Sinkinson, George
Viant, S. P.



Smith, Alfred (Sunderland)
Walkden, A. G.
TELLERS FOR THE AYES.-


Smith, Ben (Bermondsey, Rotherhithe)
Walker, J.
Mr. Charles Edwards and Mr. William Whiteley.


Smith, Frank (Nuneaton)
Wallace, H. W.



Smith, H. B. Lees (Keighley)
Wellhead, Richard C.



NOES.


Acland-Troyte, Lieut.-Colonel
Edmondson, Major A. J.
Moore, Sir Newton J. (Richmond)


Albery, Irving James
Elliot, Major Walter E.
Morrison, W. S. (Glos., Cirencester)


Allen, Sir J. Sandeman (Liverp'l., W.)
Erskine, Lord (Somerset, Weston-s.-M.)
Newton, Sir D. G. C. (Cambridge)


Amery, Rt. Hon. Leopold C. M. S.
Everard, W. Lindsay
Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Falle, Sir Bertram G.
Ormsby-Gore, Rt. Hon. William


Astor, Viscountess
Ferguson, Sir John
Peake, Capt. Osbert


Atholl, Duchess of
Fermoy, Lord
Percy, Lord Eustace (Hastings)


Atkinson, C.
Fielden E. B.
Peto, Sir Basil E. (Devon, Barnstaple)


Balfour, George (Hampstead)
Forestier-Walker, Sir L.
Pilditch, Sir Philip


Balfour, Captain H. H. (I. of Thanet)
Fremantle, Lieut.-Colonel Francis E.
Pownall, Sir Assheton


Balniel, Lord
Galbraith, J. F. W.
Ramsbotham, H.


Beamish, Rear-Admiral T. P. H.
Ganzoni, Sir John
Reid, David D. (County Down)


Beaumont, M. W.
Gilmour, Lt.-Col. Rt. Hon. Sir John
Remer, John R.


Berry, Sir George
Gower, Sir Robert
Rentoul, Sir Gervais S.


Betterton, Sir Henry B.
Grace, John
Reynolds, Col. Sir James


Bevan, S. J. (Holborn)
Graham, Fergus (Cumberland, N.)
Richardson, Sir P. W. (Sur'y, Ch'ts'y)


Birchall, Major Sir John Dearman
Grattan-Doyle, Sir N.
Roberts, Sir Samuel (Ecclesall)


Bird, Ernest Roy
Greene, W. P. Crawford
Ruggles-Brise, Lieut.-Colonel E. A.


Bourne, Captain Robert Croft
Grenfell, Edward C. (City of London)
Russell, Alexander West (Tynemouth)


Bowater, Col. Sir T. Vansittart
Gretton, Colonel Rt. Hon. John
Salmon, Major I.


Bowyer, Captain Sir George E. W.
Gritten, W. G. Howard
Samuel, A. M. (Surrey, Farnham)


Boyce, H. L.
Guinness, Rt. Hon. Walter E.
Samuel, Samuel (W'dsworth, Putney)


Bracken, B.
Gunston, Captain D. W.
Sandeman, Sir N. Stewart


Brass, Captain Sir William
Hackinq, Rt. Hon. Douglas H.
Savery, S. S.


Briscoe, Richard George
Hall, Lieut.-Col. Sir F. (Dulwich)
Smith, R. W. (Aberd'n & Kinc'dine, C.)


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Hammersley, S. S.
Smith-Carington, Neville W.


Buckingham, Sir H.
Hannon, Patrick Joseph Henry
Smithers, Waldron


Burton, Colonel H. W.
Harvey, Major S. E. (Devon, Totnes)
Somerville, A. A. (Windsor)


Butler, R. A.
Hennessy, Major Sir G. R. J.
Spender-Clay, Colonel H.


Cadogan, Major Hon. Edward
Herbert, Sir Dennis (Hertford)
Stanley, Lord (Fylde)


Carver, Major W. H.
Hills, Major Rt. Hon. John Waller
Stanley, Maj. Hon. O. (W'morland)


Castle Stewart, Earl of
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Steel-Maitland, Rt. Hon. Sir Arthur


Cayzer, Sir C. (Chester, City)
Hope, Sir Harry (Forfar)
Stuart, Hon. J. (Moray and Nairn)


Cayzer, Maj. Sir Herbt. R. (Prtsmth, S.)
Horne, Rt. Hon. Sir Robert S.
Sueter, Rear-Admiral M. F.


Chamberlain, Rt. Hn. Sir J. A. (Birm., W.)
Howard-Bury, Colonel C. K.
Thomas, Major L. B. (King's Norton)


Chamberlain, Rt. Hon. N. (Edgbaston)
Iveagh, Countess of
Thomson, Sir F.


Churchill, Rt. Hon. Winston Spencer
Jones, Sir G. W. H. (Stoke New'gton)
Tinne, J. A.


Cobb, Sir Cyril
Kindersley, Major G. M.
Titchfield, Major the Marquess of


Cockerill, Brig.-General Sir George
King, Commodore Rt. Hon. Henry D.
Turton, Robert Hugh


Colfox, Major William Philip
Knox, Sir Alfred
Vaughan-Morgan, Sir Kenyon


Courthope, Colonel Sir G. L.
Lamb, Sir J. Q.
Ward, Lieut.-Col. Sir A. Lambert


Cranborne, Viscount
Lane Fox, Col. Rt. Hon. George R.
Wardlaw-Milne, J. S.


Croft, Brigadier-General Sir H.
Leighton, Major B. E. P.
Warrender, Sir Victor


Crookshank, Capt. H. C.
Llewellin, Major J. J.
Wayland, Sir William A.


Croom-Johnson, R. P.
Locker-Lampson, Rt. Hon. Godfrey
Wells, Sydney R.


Culverwell, C. T. (Bristol, West)
Long, Major Eric
Williams, Charles (Devon, Torquay)


Cunliffe-Lister, Rt. Hon. Sir Philip
Lymington, Viscount
Windsor-Clive, Lieut.-Colonel George


Dalkeith, Earl of
Macdonald, Capt. P. D. (I. of W.)
Winterton, Rt. Hon. Earl


Dalrymple-White, Lt.-Col. Sir Godfrey
Maitland, A. (Kent, Faversham)
Withers, Sir John James


Davidson, Major-General Sir J. H.
Makins, Brigadier-General E.
Wolmer, Rt. Hon. Viscount


Davies, Dr. Vernon
Marjoribanks, E. C.
Womersley, W. J.


Davies, Maj. Geo. F.(Somerset, Yeovil)
Mason, Colonel Glyn K.
Wood, Rt. Hon. Sir Kingsley


Davison, Sir W. H. (Kensington, S.)
Meller, R. J.
Worthington-Evans, Rt. Hon. Sir L.


Dixon, Captain Rt. Hon. Herbert
Merriman, Sir F. Boyd



Duckworth, G. A. V.
Mitchell, Sir W. Lane (Streatham)
TELLERS FOR THE NOES.-


Dugdale, Capt. T. L.
Mond, Hon. Henry
Captain Margesson and Captain Wallace.


Eden, Captain Anthony
Monsell, Eyres, Com. Rt. Hon. Sir B.

Question put accordingly, "That the words proposed to be left out stand part of the Clause."

The Committee divided: Ayes, 233; Noes, 191.

Division No. 384.]
AYES.
[6.50 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Hayes, John Henry
Phillips, Dr. Marion


Adamson, W. M. (Staff., Cannock)
Henderson, Right Hon. A. (Burnley)
Pole, Major D. G.


Addison, Rt. Hon. Dr. Christopher
Henderson, Arthur, Junr. (Cardiff, S.)
Potts, John S.


Aitchison, Rt. Hon. Craigie M.
Henderson, Thomas (Glasgow)
Price, M. P.


Alexander, Rt. Hon. A. V. (Hillsbro')
Henderson, W. W. (Middx., Enfield)
Pybus, Percy John


Ammon, Charles George
Herriotts, J.
Rathbone, Eleanor


Arnott, John
Hirst, G. H. (York W. R. Wentworth)
Raynes, W. R.


Attlee, Clement Richard
Hirst, W. (Bradford, South)
Richards, R.


Ayles, Walter
Hoffman, P. C.
Richardson, R. (Houghton-le-Spring)


Baker, John (Wolverhampton, Bilston)
Hopkin, Daniel
Riley, F. F. (Stockton-on-Tees)


Baldwin, Oliver (Dudley)
Horrabin, J. F.
Ritson, J.


Barnes, Alfred John
Hudson, James H. (Huddersfield)
Roberts, Rt. Hon. F. O. (W. Bromwich)


Barr, James
Jenkins, W. (Glamorgan, Neath)
Romeril, H. G.


Batey, Joseph
John, William (Rhondda, West)
Rosbotham, D. S, T.


Bellamy, Albert
Jones, J. J. (West Ham, Silvertown)
Rowson, Guy


Benn, Rt. Hon. Wedgwood
Jones, Morgan (Caerphilly)
Salter, Dr. Alfred


Bennett, Capt. Sir E. N. (Cardiff C.)
Jowett, Rt. Hon. F. W.
Sanders, W. S.


Bennett, William (Battersea, South)
Jowitt, Rt. Hon. Sir W. A.
Sawyer, G. F.


Benson, G.
Kelly, W. T.
Scrymgeour, E.


Bentham, Dr. Ethel
Kennedy, Thomas
Scurr, John


Bevan, Aneurin (Ebbw Vale)
Kenworthy, Lt.-Com. Hon. Joseph M.
Sexton, James


Bondfield, Rt. Hon. Margaret
Lang, Gordon
Shaw, Rt. Hon. Thomas (Preston)


Bowen, J. W.
Lansbury, Rt. Hon. George
Shepherd, Arthur Lewis


Bowerman, Rt. Hon. Charles W.
Lathan, G.
Sherwood, G. H.


Brockway, A. Fenner
Law, A. (Rossendale)
Shield, George William


Bromfield, William
Lawrence, Susan
Shiels, Dr. Drummond


Brooke, W.
Lawther, W. (Barnard Castle)
Shillaker, J. F.


Brothers, M.
Leach, W.
Short, Alfred (Wednesbury)


Brown, C. W. E. (Notts, Mansfield)
Lee, Frank (Derby, N. E.)
Simmons, C. J.


Brown, Ernest (Leith)
Lee, Jennie (Lanark, Northern)
Sinkinson, George


Brown, Rt. Hon. J. (South Ayrshire)
Lees, J.
Smith, Alfred (Sunderland)


Burgess, F. G.
Lewis, T. (Southampton)
Smith, Ben (Bermondsey, Rotherhithe)


Caine, Derwent Hall-
Lindley, Fred W.
Smith, Frank (Nuneaton)


Cameron, A. G.
Logan, David Gilbert
Smith, H. B. Lees (Keighley)


Cape, Thomas
Longbottom, A. W.
Smith, Tom (Pontefract)


Carter, W. (St. Pancras, S. W.)
Longden, F.
Smith, W. R. (Norwich)


Charleton, H. C.
Lovat-Fraser, J. A.
Snell, Harry


Chater, Daniel
Lowth, Thomas
Snowden, Rt. Hon. Philip


Church, Major A. G.
Lunn, William
Snowden, Thomas (Accrington)


Cluse, W. S.
Macdonald, Gordon (Ince)
Sorensen, R.


Clynes, Rt. Hon. John R.
MacDonald, Rt. Hon. J. R. (Seaham)
Stamford, Thomas W.


Cocks, Frederick Seymour
McElwee, A.
Strachey, E. J. St. Loe


Compton, Joseph
McKinlay, A.
Strauss, G. R.


Cove, William G.
MacLaren, Andrew
Sutton, J. E.


Daggar, George
Maclean, Nell (Glasgow, Govan)
Taylor, R. A. (Lincoln)


Dallas, George
MacNeill-Weir, L.
Thomas, Rt. Hon. J. H. (Derby)


Dalton, Hugh
McShane, John James
Thorne, W. (West Ham, Plaistow)


Day, Harry
Malone, C. L'Estrange (N'thampton)
Thurtle, Ernest


Denman, Hon. R. D.
Mansfield, W.
Tinker, John Joseph


Dickson, T.
March, S.
Toole, Joseph


Duncan, Charles
Marcus, M.
Townend, A. E.


Ede, James Chuter
Marley, J.
Trevelyan, Rt. Hon. Sir Charles


Edmunds, J. E.
Marshall, Fred
Vaughan, D. J.


Edwards, E. (Morpeth)
Mathers, George
Viant, S. P.


Egan, W. H.
Matters, L. W.
Walkden, A. G.


Foot, Isaac
Messer, Fred
Walker, J.


Freeman, Peter
Middleton, G.
Wallace, H. W.


Gardner, B. W. (West Ham, Upton)
Mills, J. E.
Wallhead, Richard C.


Gardner, J. P. (Hammersmith, N.)
Milner, Major J.
Watkins, F. C.


Gibbins, Joseph
Montague, Frederick
Watson, W. M. (Dunfermline)


Gibson, H. M. (Lancs, Mossley)
Morgan, Dr. H. B.
Watts-Morgan, Lt.-Col. D. (Rhondda)


Gill, T. H.
Morley, Ralph
Wedgwood, Rt. Hon. Josiah


Gillett, George M.
Morrison, Herbert (Hackney, South)
Welsh, James (Paisley)


Gossling, A. G.
Mort, D. L.
Welsh, James C. (Coatbridge)


Gould, F.
Moses, J. J. H.
White, H. G.


Graham, Rt. Hon. Win. (Edin., Cent.)
Mosley, Lady C. (Stoke-on-Trent)
Whiteley, Wilfrid (Birm., Ladywood)


Greenwood, Rt. Hon. A. (Colne)
Mosley, Sir Oswald (Smethwick)
Williams, Dr. J. H. (Llanelly)


Grenfell, D. R. (Glamorgan)
Muff, G.
Williams, T. (York, Don Valley)


Griffiths, T. (Monmouth, Pontypool)
Muggeridge, H. T.
Wilson, C. H. (Sheffield, Attercliffe)


Groves, Thomas E.
Murnin, Hugh
Wilson, J. (Oldham)


Grundy, Thomas W.
Naylor, T. E.
Wilson, R. J. (Jarrow)


Hall, F. (York, W. R., Normanton)
Newman, Sir R. H. S. D. L. (Exeter)
Winterton, G. E. (Leicester, Loughb'gh)


Hall, G. H. (Merthyr Tydvil)
Noel Baker, P. J.
Wise, E. F.


Hall, Capt. W. P. (Portsmouth, C.)
Oldfield, J. R.
Wood, Major McKenzie (Banff)


Hardie, George D.
Oliver, George Harold (Ilkeston)
Young, R. S. (Islington, North)


Harris, Percy A.
Palin, John Henry



Hartshorn, Rt. Hon. Vernon
Paling, Wilfrid
TELLERS FOR THE AYES.-


Hastings, Dr. Somerville
Parkinson, John Allen (Wigan)
Mr. Charles Edwards and Mr. William Whiteley.


Haycock, A. W.
Pethick-Lawrence, F. W.



NOES.


Acland-Troyte, Lieut.-Colonel
Falle, Sir Bertram G.
Monsell, Eyres, Com. Rt. Hon. Sir B.


Albery, Irving James
Ferguson, Sir John
Moore, Sir Newton J. (Richmond)


Amery, Rt. Hon. Leopold C. M. S.
Fermoy, Lord.
Morris, Rhys Hopkins


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Fielden E. B.
Morris-Jones, Dr. J. H. (Denbigh)


Aske, Sir Robert
Forestier-Walker, Sir L.
Morrison, W. S. (Glos., Cirencester)


Astor, Viscountess
Fremantle, Lieut-Colonel Francis E.
Nathan, Major H. L.


Atholl, Duchess of
Galbraith, J. F. W.
Newton, Sir D. G. C. (Cambridge)


Atkinson, C.
Ganzoni, Sir John
Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)


Baldwin, Rt. Hon. Stanley (Bewdley)
Gilmour, Lt.-Col. Rt. Hon. Sir John
Oliver, P. M. (Man., Blackley)


Balfour, George (Hampstead)
Glassey, A. E.
Ormsby-Gore, Rt. Hon. William


Balfour, Captain H. H. (I. of Thanet)
Gower, Sir Robert
Owen, H. F. (Hereford)


Balniel, Lord
Grace, John
Peake, Capt. Osbert


Beamish, Rear-Admiral T. P. H.
Graham, Fergus (Cumberland, N.)
Percy, Lord Eustace (Hastings)


Beaumont, M. W.
Grattan-Doyle, Sir N.
Peto, Sir Basil E. (Devon, Barnstaple)


Berry, Sir George
Gray, Milner
Pilditch, Sir Philip


Bevan, S. J. (Holborn)
Greene, W. P. Crawford
Pownall, Sir Assheton


Birchall, Major Sir John Dearman
Grenfell, Edward C. (City of London)
Ramsay, T. B. Wilson


Bird, Ernest Roy
Gretton, Colonel Rt. Hon. John
Ramsbotham, H.


Birkett, W. Norman
Griffith, F. Kingsley (Middlesbro' W.)
Reid, David D. (County Down)


Blindell, James
Gritten, W. G. Howard
Remer, John R.


Bourne, Captain Robert Croft
Guinness, Rt. Hon. Walter E.
Rentoul, Sir Gervais S.


Bowater, Col. Sir T. Vansittart
Gunston, Captain D. W.
Reynolds, Col. Sir James


Bowyer, Captain Sir George E. W.
Hacking, Rt. Hon. Douglas H.
Richardson, Sir P. W. (Sur'y, Ch'ts'y)


Boyce, H. L.
Hall, Lieut.-Col. Sir F. (Dulwich)
Roberts, Sir Samuel (Ecclesall)


Bracken, B.
Hammersley, S. S.
Ruggles-Brise, Lieut.-Colonel E. A.


Brass, Captain Sir William
Hannon, Patrick Joseph Henry
Russell, Alexander West (Tynemouth)


Briscoe, Richard George
Hartington, Marquess of
Russell, Richard John (Eddisbury)


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Harvey, Major S. E. (Devon, Totnes)
Salmon, Major I.


Buckingham, Sir H.
Hennessy, Major Sir G. R. J.
Samuel, A. M. (Surrey, Farnham)


Burgin, Dr. E. L.
Herbert, Sir Dennis (Hertford)
Samuel, Samuel (W'dsworth, Putney)


Burton, Colonel H. W.
Hills, Major Rt. Hon. John Waller
Sandeman, Sir N. Stewart


Butler, R. A.
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Savery, S. S.


Cadogan, Major Hon. Edward
Hope, Sir Harry (Forfar)
Scott, James


Carver, Major W. H.
Hore-Belisha, Leslie
Shepperson, Sir Ernest Whittome


Castie Stewart, Earl of
Horne, Rt. Hon. Sir Robert S.
Sinclair, Sir A. (Caithness)


Cayzer, Sir C. (Chester, City)
Howard-Bury, Colonel C. K.
Smith, R. W. (Aberd'n & Kinc'dine, C.)


Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.)
Hunter, Dr. Joseph
Smith-Carington, Neville W.


Chamberlain, Rt. Hn. Sir J. A. (Birm., W.)
Hutchison, Maj.-Gen. Sir R.
Smithers, Waldron


Chamberlain, Rt. Hon. N. (Edgbaston)
Iveagh, Countess of
Somerville, A. A. (Windsor)


Churchill, Rt. Hon. Winston Spencer
Jones, F. Llewellyn- (Flint)
Stanley, Maj. Hon. O. (W'morland)


Cockerill, Brig.-General Sir George
Jones, Sir G. W. H. (Stoke New'gton)
Steel-Maitland, Rt. Hon. Sir Arthur


Colfox, Major William Philip
Jones, Henry Haydn (Merioneth)
Stuart, Hon. J. (Moray and Nairn)


Courthope, Colonel Sir G. L.
Jones, Rt. Hon. Leif (Camborne)
Sueter, Rear-Admiral M. F.


Cranborne, Viscount
Kindersley, Major G. M.
Thomas, Major L. B. (King's Norton)


Croft, Brigadier General Sir H.
King, Commodore Rt. Hon. Henry D.
Thomson, Sir F.


Crookshank, Capt. H. C.
Knox, Sir Alfred
Tinne, J. A.


Croom-Johnson, R. P.
Lamb, Sir J. Q.
Titchfield, Major the Marquess of


Culverwell, C. T. (Bristol, West)
Lambert, Rt. Hon. George (S. Molton)
Turton, Robert Hugh


Cunliffe-Lister, Rt. Hon. Sir Philip
Lane Fox, Col. Rt. Hon. George R.
Walters, Rt. Hon. Sir J. Tudor


Dalkeith, Earl of
Leighton, Major B. E. P.
Ward, Lieut-Col. Sir A. Lambert


Dalrymple-White. Lt.-Col. Sir Godfrey
Liewellin, Major J. J.
Wardlaw-Milne, J. S.


Davidson, Major-General Sir J. H.
Locker-Lampson, Rt. Hon. Godfrey
Wayland, Sir William A.


Davies, Dr. Vernon
Long, Major Eric
Wells, Sydney R.


Davies, E. C. (Montgomery)
Macdonald, Capt. P. D. (I. of W.)
Williams, Com. C. (Devon. Torquay)


Davies, Maj. Geo. F. (Somerset, Yeovil)
Macpherson, Rt. Hon. James I.
Windsor-Clive, Lieut.-Colonel George


Davison, Sir W. H. (Kensington, S.)
Maitland, A. (Kent, Faversham)
Winterton, Rt. Hon. Earl


Dixon, Captain Rt. Hon. Herbert
Makins, Brigadier-General E.
Withers, Sir John James


Duckworth, G. A. V.
Margesson, Captain H. D.
Wolmer, Rt. Hon. Viscount


Dugdale, Capt. T. L.
Marjoribanks, E. C.
Womersley, W. J.


Eden, Captain Anthony
Mason, Colonel Glyn K.
Wood, Rt. Hon. Sir Kingsley


Edmondson, Major A. J.
Meller, R. J.
Worthington-Evans, Rt. Hon. Sir L.


Elliot, Major Walter E.
Merriman, Sir F. Boyd



Elmley, Viscount
Millar, J. D.
TELLERS FOR THE NOES.—


Erskine, Lord (Somerset, Weston-s.-M.)
Mitchell, Sir W. Lane (Streatham)
Captain Wallace and Sir Victor Warrender.


Everard, W. Lindsay
Mond, Hon. Henry

Mr. CHURCHILL: I beg to move, "That Mr. Chairman do report Progress, and ask leave to sit again."
7.0 p.m.
I am very anxious that the course of our discussion shall be as smooth as possible and that the time available shall be employed in as fruitful a manner as we can conceive and, therefore in view of the progress that has been made this afternoon, or rather the little progress, I would ask
the Financial Secretary, in the absence of the Chancellor of the Exchequer, whether he can make any further statement as to the wishes of the Government in regard to our proceedings to-night. I would point out how very clearly our objective is marked out for us by the Order Paper. We are dealing now with this immensely important Clause dealing with London valuation. I am entitled to say that the debate has not been conducted solely on
party lines. The representatives of 13,000,000 of electors have all expressed growing anxiety at the character of this Clause, and the Government majority in the last Division has borne the deep dint of an increasing amount of Parliamentary misgiving. Unquestionably, the discussion of this Clause must be protracted. After that, we have a Clause which I frankly admit is of less consequence and less fertile in points of principle, dealing mainly with machinery but still important machinery which it is our duty to see is bright and clean and well oiled and efficiently adapted.
We might well have asked that the discussion should come to an end with Part II. I think we can most certainly arrange to gratify the right hon. Gentleman upon Part II at a very reasonable hour to-night, but he has, like a hard taskmaster—though he has not pressed us so hard so far, and I am most anxious to keep the debate in that good-tempered character which it has hitherto borne—asked us to accord him Clause 28. That raises enormous questions with very large sums of money to be taken from the direct taxpayer, and, of course, we must consider that Clause together with other Clauses affecting Estate Duties. The right hon. Gentleman would be well advised to let us know that he will not press matters beyond Clause 28 to-night, because then the Committee will be able to space out the limited time before twelve o'clock or quarter past in the manner which would assure the most useful and effective debate; otherwise, we might easily find ourselves in for another long nocturnal wrangle.
There is another reason to which I must call the attention of the Chancellor of the Exchequer before he replies. As he has been informed by my hon. Friend the Member for Watford (Sir D. Herbert), a very grave flaw has been detected in the drafting structure of the Bill, and we have to submit a point of Order and procedure to the Chair when the time comes which unquestionably will affect the whole group of Clauses from Clause 29 to Clause 33, inclusive. My hon. Friend was well advised in submitting this matter in good time to the Chancellor of the Exchequer and also to your colleague in the Chair, and we have for a considerable number of weeks been studying this point
with the highest authorities to which we can have access and have no doubt whatever of the strength——

The DEPUTY-CHAIRMAN: We cannot go into the point of Order at this stage. While information that it is going to be raised is quite in order, the right hon. Gentleman must not go further.

Mr. CHURCHILL: I will not go further than to say that we have the utmost confidence in the strength—though it is not for me to say in the validity—of our arguments. It would be a very great pity if the matter came to be discussed at nine or ten o'clock to-morrow morning after a prolonged and harassing all-night sitting. It would be far better to get Clause 28 to-night, which I believe you can do if we now begin to space out our time to the best advantage and to curtail ruthlessly our discussions, and then start on Wednesday afternoon with this very grave constitutional issue which is to be raised before we discuss the five Clauses dealing with the private company. I have risen early to make this Motion, because, if one leaves it later, there is so little time to be saved, and it would not be possible, with the best will in the world, to compress discussion within those limits.

The CHANCELLOR of the EXCHEQUER (Mr. Philip Snowden): The agreeable and persuasive manner with which I conduct discussions and proceedings in Committee has evidently affected the right hon. Gentleman. I also appreciate his desire to save time, and upon that we can harmoniously co-operate. The right hon. Gentleman has suggested that I should attempt to get to the end of Clause 28. That will not give us very much progress on this Bill. As I said at the opening of the Committee stage this afternoon, I quite realise that Clause 29 is a very important Clause, and I may perhaps say that I shall not oppose any Amendments to the Clause which do not strike at the object and the structure of the Clause. It is largely a matter for lawyers rather than for laymen, and the legal luminaries in the House, I have no doubt, will be able to make their suggestions which will add to the effectiveness of the Clause. I do not want to enter upon a discussion on that Clause before it comes. I have made my offer to the right hon. Gentleman with this com-
promise. He says that the hon. Member for Watford (Sir D. Herbert) is going to raise a point of Order. I thank him for having given me notice of his intention, but the importance of the point of Order, so far as I can judge, is not so great as the right hon. Gentleman has assumed. Now the first Amendment on the Paper is one to postpone Clause 29. The point of Order need not take us very long, nor need the proposal to postpone Clause 29. If the right hon. Gentleman will agree to take those two points after disposing of Clause 28, then I am quite willing not to keep the House any longer.

Mr. SMITHERS: Does the right hon. Gentleman propose to accept the Amendment to take Clause 33 first?

Mr. SNOWDEN: Certainly not.

Mr. CHURCHILL: We think we should stop at Clause 28 to-night and raise this big point of Order and the new principles involved in the group of Clauses beginning with Clause 29 when we come back on Wednesday. I am sure that is the reasonable and practical course to take. The right hon. Gentleman is not very far from adopting this course, and I shall not say a word to incline him to turn his thumb down or to cast a harshness over our proceedings. We can, I believe, have useful debates up to a quarter past 12 or midnight and finish up Clause 28, and then address ourselves on Wednesday to those principles and those highly technical matters which arise on Clause 29. I cannot make any bargain affecting another day. There is no doubt that if the right hon. Gentleman pursues his endeavours to meet the wishes and views of the Opposition and continues the course of accepting Amendments which do not ruin the principles he has in view, namely, the prevention of improper evasion, and accepts a large number of Amendments which do not upset his principles and prevent business in general being affected by these provisions, such an attitude would abridge discussion. If we separate at the end of Clause 28 to-night, we shall arrive at the discussion of our business on Wednesday without any feeling of rancour or ill-usage from his conduct of our debate this evening.

Sir HERBERT SAMUEL: Perhaps I might say just a word in order to promote this conciliatory attitude which prevails. I do not know whether it is the fact announced on the tape this afternoon that the Treasury has received a windfall in Estate Duties of £4,250,000 that is the cause why the Chancellor of the Exchequer is so conciliatory in his dealings with the Opposition this afternoon. Whatever the reason may be, we are happy to find the two larger parties coming to an agreement on the course of business. When they disagree, it is my hon. Friends on these benches who suffer with the rest of the Committee. I think it is obviously reasonable that Clause 29 should be taken on a fresh day. In daylight the legal luminaries will, perhaps, shine even brighter than they would at night, and it will certainly be easier to follow their arguments on this very technical subject. As regards the extremely narrow point at which the Committee has arrived I think we could come to an arrangement by splitting the difference. The Amendment to postpone Clause 29 is an Amendment of a very useful character if it is intended to occupy a considerable amount of time, but it is not, in itself, an Amendment of very great value; and if hon. Gentlemen above the Gangway agree not to move that Amendment, perhaps the Chancellor of the Exchequer will agree that the point of Order should be taken at the outset of Wednesday's debate?

Mr. CHURCHILL: I think there is a great deal of force in the suggestion of the right hon. Gentleman the Member for Darwen (Sir H. Samuel). If our point of Order when raised on Wednesday next were to succeed it would have the effect, probably, of leading to the temporary withdrawal of these Clauses in order that they might be amended by the Government before being discussed. In these circumstances, if we finish with Clause 28 to-night, I certainly think we should be well advised not to move for the postponement of Clause 29, but to proceed at once on Wednesday, after the point of Order has been disposed of, to deal with the Amendments either by a general discussion on one Amendment or, in the ordinary way, and in strict accordance with the terms of each Amendment. I am most anxious to have as easy a passage in the Committee as is possible
in conformity with our duty of examining this complicated Measure carefully.

Mr. SMITHERS: As the Amendment to postpone Clause 29 until after consideration of Clause 33 stands in my name, I may be allowed to say that I am anxious to help the business of the Committee and I repudiate entirely what the right hon. Gentleman the Member for Darwen (Sir H. Samuel) said about this Amendment. It was put down in a perfectly sincere desire to arrive at a definition of these five Clauses before discussing them. I understand from my friends who are acquainted with drafting that Clause 33, which is the definition Clause, is in its right place in the Bill, but it would be more convenient to discuss it before discussing Clauses 29 to 32. However, if it will facilitate business and bring about a slight rapprochement between the Chancellor of the Exchequer and his predecessor, I am quite willing to agree to the course proposed.

Mr. P. SNOWDEN: I am pleased that the hon. Member has fallen in with the suggestion of the right hon. Gentleman and I am quite agreeable to accept that suggestion also provided that it involves no sacrifice on my part.

Mr. CHURCHILL: In that case, I beg to ask leave to withdraw the Motion.

Motion, by leave, withdrawn.

The DEPUTY-CHAIRMAN: Sir William Brass.

Mr. MARJORIBANKS: On a point of Order. May I ask if the Amendment on the Paper—in page 22, line 23, at the end, to insert the words:
Provided that, notwithstanding anything in this section or any repeal effected by this Act, any taxpayer aggrieved with the annual value of his property as ascertained for the purpose of the Income Tax Acts shall be entitled to all rights of appeal against such annual value as though the provisions of the Valuation (Metropolis) Act, 1869, were still in force.
is out of order?

The DEPUTY-CHAIRMAN: It is not selected.

Sir W. BRASS: I beg to move, in page 22, line 32, at the end to add the words:
(3) Notwithstanding anything in this section or any repeal effected by this Act, any rule which, under the provisions of the Valuation (Metropolis) Act, 1969, has had
effect in the administrative county of London relating to the allowances for empties in the valuation for the purpose of Income Tax of houses let in separate suites, or in relation to the running cost of lifts in such houses, shall continue to have effect in the said county in the like cases and manner and with the like consequences as if all the provisions of that Act had continued in force.
There is a considerable feeling of uneasiness in London, especially in the City of London, in connection with Clause 26. The Chancellor of the Exchequer and the Financial Secretary have based their arguments for the Clause almost exclusively on their desire to get an extra £500,000 of revenue, but we have not heard how it is expected to get that revenue. What is disturbing some people in the City is the question of whether, in seeking to get this amount by splitting the valuation and giving us two instead of one, the allowances for empties and for lifts and so forth will be affected. It is feared that these allowances will not be the same under the two valuations as they are at the present time. That is the uneasiness felt by my friends who have asked me to move this Amendment. The third Schedule to the Act of 1869—which is in effect being repealed by Clause 26—contains these words:
The maximum rate of deductions prescribed in this Schedule shall not apply to houses or buildings let in separate tenements but the rate of deduction in such cases shall be determined as in classes 9, 10 and 11.
Regarding those classes, these words appear in the margin:
To be determined in each case according to the circumstances and the general principles of Law.
But the same thing does not appear in the Finance Act of 1923, which I understand deals with the allowances which will become effective if this Clause is passed. I wish the Committee to understand the necessity for having these allowances for empties and lifts and so on as laid down in the Amendment because, in the City and in other parts of London as well, there are certain large tenement buildings let out as offices. These buildings are assessed quinquennially, and allowances are made for empties which may appear during the period of the quinquennium. If the valuation for Schedule A purposes is going to be made on the absolute rent which is being received for the various offices every year, then it would appear that a new
valuation far the Schedule A part under the Bill would have to be made every year unless the ordinary allowances are going to be given for empties as at the present time. If I can get an undertaking from the Chancellor of the Exchequer that things are not going to be altered and that the practice in this respect is going to remain exactly as it is to-day then, of course, there is no reason for the Amendment.

Mr. P. SNOWDEN: I can very briefly, and without hesitation give the hon. and gallant Gentleman that assurance. All allowances under the existing Income Tax laws will be continued, such as repairs, empties, and so forth, as they exist under the present law. The only thing which the Clause does is to empower a special assessment for Income Tax, but it does not alter the allowances which can be made for local rating purposes, and it does not interfere with the allowances under the general Income Tax law.

Mr. SMITHERS: As my name is attached to this Amendment, perhaps I may be allowed to thank the right hon. Gentleman for his assurance.

Sir W. BRASS: In view of the statement by the Chancellor of the Exchequer, I beg to ask leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Major ELLIOT: Surely on the question, "That the Clause stands part of the Bill," we shall have some reply from the right hon. Gentleman to the cogent arguments which have been advanced with regard to the question of the single valuation. We were promised a very full discussion and a very full reply on that matter by the Chancellor of the Exchequer and I should like in particular to know the right hon. Gentleman's mind as to whether his adoption of the double valuation for London has been forced upon him by the necessities of the time and whether he agrees with so much of the opinion which has been given in reports of Commissions and of departmental committees and elsewhere as to the desirability of having a single valuation. The ex-Parliamentary Secretary to
the Ministry of Health pointed out that in the first draft of the Rating and Valuation Bill it was suggested that a single valuation should take place and that the procedure in the provinces should be assimilated to that in London. It is now proposed to assimilate the procedure in London to that in the provinces, and this undoubtedly goes counter to a great many recommendations which have been made on the matter. Is the Chancellor of the Exchequer doing this because of the necessities of the times?
In Scotland, single valuation still remains, and it is not proposed to abolish it in this Bill. Whether it is a question of doing so in any future Bill, I cannot say, but we should like to be assured on that, because if the general principle is being laid down by the Chancellor of the Exchequer that double valuation is preferable to single valuation, it will obviously spread all over the Kingdom, but if he is merely dealing with an emergency in an emergency way, it is possible that the system in the North may not be disturbed and that we may subsequently come to the single valuation covering the whole of England including London. If there are any difficulties which have been found in working it, we should like to know, because these difficulties were not made clear by the Financial Secretary to the Treasury, and the actual fact that it was suggested that a considerable amount—I think, £500,000—of extra revenue was involved seems to indicate that the power of appeal possessed by the Inland Revenue had not been fully used.
The other point, which was made by the right hon. Member for St. George's (Sir L. Worthington-Evans), was that the clerk to the Westminster City Council had made a very careful examination of the problem of double and single valuation and had most emphatically recommended that the single valuation should be maintained: and, speaking doubtless on that occasion as the representative for Westminster, the right hon. Gentleman was anxious to have some answer made to that case. For all these reasons, it would be of interest to have some statement made covering the points raised, and we should be greatly obliged to the Chancellor of the Exchequer if he would give us the benefit of his views on the subject.

Mr. P. SNOWDEN: I regret that I was not able to be present during the discussion on this Clause, but I had a very important committee meeting which it was essential that I should attend. I did hear the hon. Member for Eastbourne (Mr. Marjoribanks) move the first and, I think, the most important Amendment, and he and the hon. and gallant Member for Kelvingrove (Major Elliot) put a number of definite questions. Both of them asked whether, in proposing this change, I was actuated solely, as the hon. and gallant Member put it, by the necessities of the time, or, as the hon. Member for Eastbourne put it, to secure increased revenue. These are very necessitous times for a Chancellor of the Exchequer, and the possibility of an increased revenue is not one that he can altogether ignore. The Committee is well aware that it is estimated that by the change proposed we may receive an additional revenue from London under Schedule A of about £500,000 a year, but that figure is only the measure of the annual loss that the revenue has been suffering for a considerable number of years past, owing to the fact, as was pointed out in the previous discussion upon this matter, that the assessments for rating purposes in London do not as a general rule approximate to the annual income value of the property.
The hon. Member for Eastbourne put the pitiable case of the old age pensioner, but I do not suppose that there are many persons qualified to receive an old age pension under the non-contributory scheme who will be affected by any changes in the Income Tax law.

Major ELLIOT: Is it not the case that there is the possibility of an increased valuation of their property bringing them out of the means qualification?

Mr. SNOWDEN: There are, or there will be under this Clause when it becomes law, separate valuations for local rating purposes and for Income Tax purposes, and no change in the Income Tax assessment could possibly affect the liability of a person with such limited means as an old age pensioner and could not in the least affect his eligibility for an old age pension. Both hon. Members have referred to the recommendation of the Royal Commission in favour of a single valuation for both purposes, but I do
not think the Commission—I have not their recommendations before me—recommended that it should be the one valuation system which is now in operation. I was in the House of Commons when this matter was discussed on the Rating and Valuation Bill in 1925. We had a very long and a very well informed discussion on the question, and after that full discussion the House of Commons decided against the single valuation.
The hon. and gallant Member for Kelvingrove was rather afraid that the alterations proposed in this Clause might be followed by a similar proposal applied to Scotland. I do not think he need have any fear of that. Scotland, in this respect as in a great many other respects, has a much more admirable system than we have had in this country, and the hon. and gallant Member knows that the inspectors of taxes take a very effective part in the fixing of assessments in Scotland. There is nothing at all in our minds about the extension of a similar provision to Scotland.
I need not go over the old ground, which has been traversed until it is almost bare, as to the reasons which have induced me to put this Clause in the Bill this year. I have not done it merely from a desire to get what I think is a just contribution from the owners of property under Schedule A, but because, on the whole, I think it is an improvement. It is not fair that we should have the two systems, because under the system which exists in London at the present time the property owners in London are, out of all question, put in a more favourable position than property owners in the provinces. They are not paying the same proportion of Income Tax upon the annual value of their property as property owners in the provinces are paying, and that, of course, makes it unjust to——

Mr. LEIF JONES: Would not the proper thing be to get one valuation made which is an accurate valuation? There cannot be two values at the same time of the same property.

Mr. SNOWDEN: Yes, but the right hon. Gentleman knows that there are very great difficulties in doing that which would, at the same time, secure a valuation which would be satisfactory to the revenue authorities, because the purpose
of the assessment is different in the case of rating and in the case of Income Tax. It does not matter what the rateable value is for local rating purposes, because what they lose upon the low assessment value they gain by a higher poundage in the rates. The main reason why we want this Clause is that it is impossible, here in London, to get justice as between the taxpayers under the system which exists now. You could not very well apply to the provinces the one system of assessment which exists in London at the present time. It would upset the whole arrangement which has worked so well for a large number of years.
The point has been made, I dare say, that it is a bit of a nuisance to a property owner to have to fill in two forms for the same property, but we have had no expression of any grievance from the provinces in regard to that matter. We are assimilating the two methods. We cannot apply to the provinces what exists at the present time in London, because the assessment for rating purposes would dominate, and therefore it would be very much lower than it ought to be for Income Tax purposes. I do not think there is any other way by which we could, here in London, get property assessed for Income Tax purposes upon a fair and equitable basis. I believe the system in the provinces has been in operation since 1842, and that the London system was adopted about 25 years later. Therefore, if antiquity be an argument that appeals to hon. Members opposite, that is an additional reason for supporting this Clause.

Mr. LEIF JONES: Antiquity in itself makes no particular appeal to me, but the right hon. Gentleman has really very much disappointed me in what he has said. I thoroughly sympathise with him in his desire to see that property owners in London pay their proper proportion of Income Tax, and I should be glad to support the Government in achieving that purpose, but I have not so far been able to bring myself to support them in this Clause. It is really going right back on what I have been preaching throughout my political life. The right hon. Gentleman says that there has been no complaint from the provinces, but I can assure him that I have been preaching the single assessment for all purposes throughout the country, and I have
always instanced London and Scotland as examples of it. I do not understand how the same property can have two values at the same time. There should be a continuous valuation for all properties in London, so that the rating authorities and the Chancellor of the Exchequer may put upon them the proper share of national and local burdens, but you cannot have two values at once on one property although you may make different deductions from them. The fact that the right hon. Gentleman has reason to complain that property owners are getting off paying their fair proportion of Income Tax is a complaint against the rating authority. There may be a reason for altering the system by which assessments are made, but nothing has been said in this debate to justify what seems to be a reactionary thing in going back to the old system which in the rest of the country we have been trying to alter.
The Chancellor of the Exchequer would do better to withdraw this Clause and reconsider the matter. I want to help him to get at the people who are not paying their fair share of Income Tax, but to have two valuations and all the bother involved in making them is not a solution of the problem. It will save time if the right hon. Gentleman will withdraw the Clause until next year, when I hope to assist him to pass another Budget, with a view to reconsidering the matter. I am confident that the real solution of the rating and taxation difficulty is to have a single valuation of all the property in the country to which the rating authority, the Income Tax authority, or any other rating authority may apply their formulæ, whatever they may be. The basis of rating and taxation should always be the same, namely, the value of the property at the time when the taxation or rating is made. That is the logical thing, and I can see no real objection to it except the desire to get hold of the property owners in London who undoubtedly at present are escaping their fair share of taxation.

Mr. P. SNOWDEN: May I put one question to the right hon. Gentleman. Supposing we had a single valuation. In London at the present time, the Revenue authorities have really no effective powers at all. In the right hon. Gentleman's system which is he going to put in the dominating position, the rat-
ing authority or the inspector of taxes? Or can he imagine any scheme which will put them on terms of equality in fixing a valuation?

Mr. LEIF JONES: I do not know that I am called upon to say what the exact system should be, but surely the right hon. Gentleman is not going to tell me that it is not possible to arrive at the fair value of property in the open market, which he wants to get. What he is saying is that the rating authorities in London are not doing their duty in regard to property. If that is so, we should deal with the rating authorities, and not ignore them and have another valuation.

Major ELLIOT: We have just given the Chancellor of the Exchequer the instance which he desires, the instance of Scotland, where we have a single valuation which is accepted as fair by the Revenue authorities. We could not do better than to pay the Chancellor of the Exchequer's expenses of a visit to Edinburgh, where we should be glad to give him hospitality, to see the system at work, so that he can consider whether it is not possible to have this system, which works very well, instead of asking us to have a hypothetical system which may not work so well.

Sir PHILIP PILDITCH: I cannot understand why the Chancellor of the Exchequer assumed that the valuations made by the local rating authorities are inaccurate for the purposes of Income Tax. That seems to be the basis of his argument, because he expects to get something more from a second valuation of property in London under the new system. The Chancellor asked my right hon. Friend the Member for Camborne (Mr. Leif Jones) which of the parties he would put in the position of having the right to make the valuation, but the Chancellor must be aware that the revenue authorities have the right of audience when the rating committee fix the gross value and the rateable value. The Surveyor of Taxes has a right to be present and to influence the fixing of the gross value. I can tell the Chancellor that the reason we have had the present system in London is that in London we have assessments every five years, when the whole thing is brought up to the mark, and it is seen
that the rating of the different districts is brought into line with each other. The Chancellor may not be aware that for many years there has been a system in London of seeing that the various authorities are working on the same lines, and dealing with their valuations in a fair way as between one district and another. That has been carried out by the London County Council for many years, and I was for many years chairman of the committee of the council which performed that duty, and I hope that it was effectively performed.
The Chancellor expects to get £500,000 from this change. I wonder if he has made any estimate of the cost of this second valuation. There are occasions when large properties have to be valued and the cost of doing it effectively is considerable, and I cannot conceive that when he goes into the question of the net return which he expects to get from this change of the law, he will find that, unless the cost of the valuation is taken up in the general expenses of the Treasury, this £500,000 will come home to him. I hope that the Chancellor may be inclined even now to reconsider a decision to alter a system which has worked with great satisfaction and with a reasonable amount of certainty in the valuation of London properties, rather than press forward this change which involves the setting up of two separate rating authorities for the same purpose, and must result in variations in valuations which will be very difficult to put right.

Major NATHAN: The Chancellor of the Exchequer referred to various commissions and committees that discussed this matter. When speaking to an Amendment earlier this afternoon, I quoted the recommendations of the Royal Commission on Local Taxation, the Royal Commission on Income Tax, and the speech of the present President of the Board of Education when speaking for the Labour party, which was then in Opposition, in the discussion on the Second Reading of the Rating and Valuation Act of 1925. I challenged the Financial Secretary to point to a single authority over the last 60 years, whether Government Department, Royal Commission, committee or professional institution, which gave expression of authoritative opinion in favour of separate
valuation. The Financial Secretary was unable to answer, and I have no doubt that if the Chancellor had heard the challenge, he would have informed the Committee if he could answer it.

Mr. P. SNOWDEN: Certainly, the House of Commons itself.

Major NATHAN: For a period of 60 years this matter has been discussed in the House of Commons time after time, with the object of getting a single valuation, and one of the difficulties has been what the right hon. Gentleman mentioned just now as being really the crux of the whole situation; that was a sort of conflict between the Inland Revenue officials on the one hand and the rating authorities on the other. The right hon. Gentleman says that the House of Commons has expressed an opinion in favour of separate valuations. Surely he must be mistaken, because on the last occasion when the matter was discussed, when the Rating and Valuation Act of 1925 was before the House of Commons, Parliament expressly reserved London, and, although they applied the system of double valuation to the provinces, they excluded London, with the result that the Act of 1869 was declared, as it still is, operative in relation to London. I wonder if the right hon. Gentleman has some other instance in his mind when this House expressed its opinion in favour of a single valuation for London? I challenged the Financial Secretary to point to an instance, and I now challenge the Chancellor to point to a single instance when this House or any other authority has declared in favour of anything but a single valuation for London.

Mr. P. SNOWDEN: The very fact that there are two systems in operation at the present time shows that this House has expressed its opinion in favour of two valuations.

8.0 p.m.

Major NATHAN: I say that this House has expressed its opinion positively and negatively in favour of a single valuation for London and nothing but a single valuation; and I would refer the right hon. Gentleman to the recommendations of committees and other professional bodies throughout the whole series of years. There seems to be a view that when a valuation is made,
whether for rating purposes or taxation purposes, its figure represents precisely the income received, the money that passes. In fact, it is nothing of the sort. A valuation is merely an expression of opinion, and when the right hon. Gentleman says he is losing taxation what he really means is that he does not agree with the value placed by the rating authorities of London upon properties in London. It means neither more nor less than that. I say with my right hon. Friend the Member for Camborne (Mr. Leif Jones) that this is not the right way of meeting the difficulty in which the Chancellor finds himself. This matter has been explored before. The Royal Commission on Income Tax made a definite reference to it when it suggested as the obvious solution that a property owner should be called upon to pay tax upon that income which he in fact received, and that where the rent received by him is in excess of the amount of the valuation he should be assessed to income tax on the excess, under, I think, Case 6 of Schedule D of the Income Tax Act, 1918.

Sir W. BRASS: Will the hon. and gallant Member say what is to happen if the landlord gets less than the amount of the assessment?

Major NATHAN: The hon. and gallant Member was forestalling something I was going to say. The Chancellor of the Exchequer has assumed throughout that the assessment will always be less than the amount received by the landlord. In fact, it is not so in a number of instances, as the Chancellor himself, no doubt, knows. Is it to be understood that the Chancellor is proposing, when the amount of the assessment is higher than the rent received by the landlord, that the taxpayer shall pay upon that assessment, but that when it is less he is to have no advantage? That seems to me a very odd way of adjusting the position between the revenue and the taxpayer.
There are other and wider reasons why I find it impossible to support this Clause. It relates to property of a value of more than £50,000,000, and the number of assessments is not far short of 1,000,000. In its operation this Clause is bound to bring a great deal of inconvenience, annoyance, irritation and expense to the subject, whether as taxpayer or ratepayer. The Chancellor pointed out when
opening his Budget that he has to depend for an increasing revenue upon a relatively very small number of taxpayers. Is there any object in pursuing a course which simply irritates and puts to expense this small body of taxpayers without effecting any real object and producing only, on the Chancellor's own showing, a sum of £500,000, with a net return of probably a great deal less? If there were any great object to be served, if any large amount of revenue were involved, it might be worth all the inconvenience and dislocation occasioned, but is it worth while to put the taxpayer to the annoyance and expense of filling up two sets of forms instead of one, employing two sets of people to represent his interests instead of one, appearing before two tribunals instead of one, only to be confronted in the end with two valuations which may be entirely different from each other?
I do really and seriously believe that one reason why the House of Commons is, perhaps, not held in the same estimation among the common people as it used to be is that when they consider the Bills that are placed before Parliament and read our debates, they find in them Clauses relating to matters of intrinsically little importance, and long, dreary debates upon matters quite out of relation to the real problems confronting our people at this time, and they say, "Stop this fooling." I say with the profoundest respect that I believe there is nothing which is affecting the mind of ordinary people more than the fact that the House of Commons is out of touch with the real problems of everyday life. The "man in the street" wants to know what we are doing about unemployment, the grave problem of India, and housing. He is interested in "bread-and-butter politics," and complains that we are talking of phantasies, of tidying-up legislation so as to make a particular scheme a little more symmetrical than it might otherwise be. Unless the House of Commons directs its attention to the real problems which are in men's minds it will lose much of its authority and its influence. People will not to-day have mere tidying up, they want us to get on with the real job, and I feel that this is a Clause which bears so little relation to the necessities of our time that I cannot support it.

Mr. ATKINSON: The Chancellor of the Exchequer asked whether there would be
any objection to a method of assessment in which the dominating influence was the revenue rather than the rating authority. The Chancellor of the Exchequer has supplied the answer. He said the objection to the present method of valuing was that it was really dominated by the rating authority, and that a low rateable value did not matter because they made it up by an increased poundage in the rates. Let us put it the other way round. What would it matter to them if the valuation were increased because it was carried out by a stricter valuation authority? The result of that would only be a lower poundage in the rates.

Mr. P. SNOWDEN: Schedule A is only a part.

Mr. ATKINSON: But if it is a fair assumption that a system which brings about low valuation makes no difference to local authorities because they can get their money by a higher poundage, it is just as true to say that a system which brings about higher values would be compensated for by a lower poundage. I cannot see how a shake of the head will dispose of that. I should not have any objection to a method of assessment which was dominated by or originated by the taxation authorities so long as there was an appeal. What I am protesting against is the dual valuation, which will require a man who owns property to fight his battle twice with different authorities and before different tribunals. It is wrong for hon. Members opposite to keep reiterating that the object of the valuation in the two cases is different. The immediate object is the same, though the use which is made of the valuation is different. The object is to get at the fair annual rental value. When that is the simple object of each valuation it seems ridiculous to have two methods of arriving at precisely the same thing.
The other day I asked the Chancellor of the Exchequer what the effect was going to be upon the owner of a house or building which was let as flats or suites of offices. He has told us that there is going to be a new method of valuation here, in which the rules will be more rigidly applied. The rule for valuation is quite clear. You have to get at the fair annual value, and the rental is not the fair annual value. I would refer the Chancellor to No. 1 of the rules under Schedule A, and I will put the case of
the owner of a building let out in suites of offices under leases for 21 years, granted at a time when rents were very low in 1916 and 1917, and where the annual value to-day would be at least twice the rentals received. Under this new system of valuation the revenue authority will assess that building on the true annual value basis, and the sum which that owner may be assessed for Income Tax may be twice that at which he is assessed to-day. The Income Tax payable may be increased by one-half, although the rents will remain as they were fixed by the leases.
The answer the Chancellor gave me the other day showed that I had not made myself clear. He said that the occupier was enjoying a building which was of greater value than the rent he is paying for it, and it was only fair that the assessment should be raised but the case I am putting is one where the owner is assessed and not the occupier, because the building is let out in tenements. In such a case, suddenly to change the method of valuation and introduce a more rigid application of these rules may do very grave injustice. The revenue authorities will undertake this valuation in the avowed hope of getting a greatly increased revenue. The whole tendency to-day ought to, be towards simplification instead of complication, and I strongly object to the introduction of two valuations in the place of one. Let us get one valuation which satisfies people and stick to it; if is not satisfactory, let us alter it.

Sir K. VAUGHAN-MORGAN: The hon. and learned Member for Altrincham (Mr. Atkinson) has suggested that in the case he has cited the owner would be called upon to pay tax on a larger basis. May I suggest to him that all the owner has to do is to represent his case to the Income Tax commissioners, who will deal with it, although I cannot imagine a case of that kind arising.

Mr. ATKINSON: In the case of assesments made under Rule 8, it is perfectly obvious that, if the premises are not let at the full annual value, the annual value must be ascertained, and obviously that contemplates the case I have put before the Committee.

Sir K. VAUGHAN-MORGAN: I have given the hon. and learned Member a piece of advice, and, if he finds himself in those particular circumstances, I hope he will take my advice. This is not a party question, and, as I find myself in disagreement with some of my hon. Friends, I would like to give a few reasons why I support the transfer of the City of London from a single to a separate valuation. In present circumstances, the Exchequer does not receive anything like its due demands, and the occupier is in danger of having his rateable value increased beyond its proper amount. The income received from property should pay tax on the appropriate rent, subject to proper allowances. The property owner is in a favourable position inside London, and his investments enjoy advantages over other people's investments.

Mr. LEIF JONES: What difference does it make to the ratepayer whether he pays 1s. on £50 or 6d. on £100? It surely makes no difference to him if the assessment is fair all round.

Sir K. VAUGHAN-MORGAN: That is precisely my point. The right hon. Gentleman is using an example, which many of us have given before in conflict with members of his own party when dealing with the effect of assessments in the country. The right hon. Gentleman's point is that the fair value is the annual value taking one year with another, and comparing one property with another. Supposing you have, as is frequently the case in London, a row of houses, some of which are let at different rentals. In order that the Exchequer should get a larger share from the point of view of taxes from the owner, why should the occupier have his rateable value placed higher than his neighhour? That is the difficulty which has to be met. As I stated earlier in the debate, one of the reasons why I am in favour of the separate valuation is that as an Income Tax payer I have seen the effects of the application of a single valuation in London, and a separate valuation outside, and I am in favour of a separate valuation because of the greater degree of justice which it gives to the ratepayer and to the occupier in regard to his assessments, and because it gives the owner-occupier the right of appeal to the Income Tax commissioners.
I very much object to any system which fails to provide the Exchequer with its fair proportion of revenue, and at the same time mulcts the ratepayer in a higher assessment than was otherwise the case. The two things are entirely different, and I cannot agree with those who hold that you should aim at applying a similar method in dealing with this question from the point of view of rates and taxes, because rates are based on the principle of benefits received while taxes are based on the principle of ability to pay. That is why a rebate is allowed when property is not occupied. That was the basis of rating under the Poor Law in the days of Queen Elizabeth when the squire was required to find a certain sum of money to support the poor. Since that time all these services have enormously increased, and you now have two forces at work in your rateable value; one is the ability to pay and the other benefits received. The valuation for rates is entirely subject to the amount payable to the owner of the property and the amount which he expects to derive from it.
The defects of the London system are due to the fact that it is an attempt, sufficiently successful in the past, to combine two different principles in one. It therefore has the defects and disadvantages of both. Conditions are different from what they were in the old days, and even at the time of the recommendations of the Royal Commission, to which the hon. and gallant Member for North-East Bethnal Green (Major Nathan) has referred. Income Tax in those days was relatively infinitesimal, and I suppose that the Exchequer could afford to overlook the difference. On the other hand, the revenue was not impelled, in the way that it necessarily is now, to raise valuations for the purpose of obtaining taxes at the expense of the ratepayer, who thereupon finds his assessment advanced beyond the comparable figure of his neighbour for a similar kind of accommodation and for similar benefits received. These are a few of the reasons which actuate me in favour of this Clause, and, consequently, in differing somewhat in view from many hon. Members around me, and in giving, in answer to some questions which have been put, my reasons for holding that view.

Sir W. BRASS: I am afraid that the remarks of my hon. and gallant Friend the Member for East Fulham (Sir K. Vaughan-Morgan) have not convinced me that this is a good Clause. I was very much surprised to hear the remark of the Chancellor of the Exchequer just now that the revenue authorities have no effective power over the valuation list. It seems to me extraordinary that for the past 60 years in the Metropolitan area we have had, under the Metropolis (Valuation) Act, 1869, these valuation committees, and that the poor revenue authorities, having been sitting with the other members of these committees all this time, have had no power and no say in the matter of valuation. Really, if it were not for the fact that the Chancellor of the Exchequer himself said that that was the case, I could hardly believe it possible that the representatives of the Treasury would be so meek and mild as to be willing to sit there and allow valuations to go through which they thought were far too low, so that the Treasury would not get the full amount which was its due.
What is going to happen when this Clause passes? We shall then, after 60 years, have a change-over to two valuations, and the property owners, small as well as large, all over London, will have to fill in two forms instead of one. Besides that, there will be two separate valuation committees for London, and that in itself will cost a great deal of money. If they do not have two separate committees, how does my hon. and gallant Friend the Member for East Fulham reconcile the fact that the revenue authorities at the present time have no power, unless the revenue authorities are going to have a committee of their own to decide all these matters? If the Treasury officials are not going to have their own valuation committee, I do not see how they are going to be able to dominate the position in the way that the Chancellor of the Exchequer would desire. The result will be a very large number of appeals——

Mr. P. SNOWDEN: The hon. and gallant Member has just given expression to a misunderstanding which I should like to dispel. He says that two forms will be sent out, one for rating purposes and one for Income Tax purposes, but I would point out that Clause 27 minimises that difficulty. The rating authorities will
send their forms to the inspectors of taxes, and, if the particulars are sufficient to enable the inspector of taxes to make an assessment, he will make it without troubling the assessor to make a separate valuation.

Sir W. BRASS: I am much obliged to the right hon. Gentleman, but at the same time, even though only one form may be necessary, there will be two different appeals in the event of disagreement, the one in respect of the valuation for tax, and the other in respect of the valuation for rates. I do not understand how all these properties in the City and in other parts of London can really be undervalued as they are said to be, and how the introduction of two valuations instead of one is going to alter that. I understood, from the information which the Chancellor of the Exchequer kindly gave me just now, that the deductions for empties and other things which are made at the present time are going to be made in the future as they have been in the past, and that no difference will be made so far as allowances are concerned, because the allowances, as I understand it, will be agreed in common between the officials of the Treasury on the valuation committee and the representatives of the rating authority. Although, therefore, we are going to have two valuations for each property, I cannot see where the Chancellor of the Exchequer is going to get his £500,000 profit. For that reason I cannot understand why it is really necessary to put into the Finance Bill a Clause of this kind, which really deals with something that is quite different, and is, in fact, repealing an Act which has been in operation since 1869.

Mr. MARJORIBANKS: I would like to thank the Chancellor of the Exchequer for being present to reply on this occasion. I think it is very courteous of him, and I am sure that all who are interested in this subject will be very grateful for the information and answers that he has given, especially at this hour. For my part, however, I am not in the least satisfied with many of the replies that have been given by the right hon. Gentleman or by the Financial Secretary. I do not want to discuss the whole matter again from the beginning, but there is one question of principle which I must raise with the Chancellor of the Exchequer,
because it is of very great importance. The only possible basis of justice for this revaluation in London is the fact that property may have been undervalued in the past. There may be the basis of expediency that we need more revenue, and the right hon. Gentleman practically confessed that that was the paramount reason in this matter. It is a reason which many on this side of the House would respect, but, nevertheless, the only basis of justice is that in the past this system, which has worked for the last 60 years without any complaint whatever from any substantial source, has resulted in property being undervalued. The Act wisely provided, however, that the revenue officials should be parties to the proceedings of the rating committees, and that they should have the same rights of appeal as anyone else. If they have not neglected their duties, and if they have exercised their right of appeal when necessary, I cannot see that property in London can have been undervalued, or that there is any basis on which the Chancellor of the Exchequer can argue that there has been undervaluation.
The only thing is that the revenue officials were handicapped, in appealing to the courts, to the extent that they were, of course, prejudiced by the preliminary assessment of the rating authority, whereas now they will be able to come forward with their own assessments. We are almost driven to the conclusion that the officials at Somerset House have devised this Clause as a means of raising further revenue, and of saying, in effect, that in their opinion the rating authorities have undervalued property in London for a very long time. I should, however, pay far greater respect to the rating authority, with the right of appeal to a court of justice, than I should to the tax-gatherer, in his simple faith in his own opinion, and he, after all, is prejudiced in this matter.
After all, this is a question in which we might receive a great deal and we might receive less. The Division on the first Amendment proved that there is a considerable body of opinion against this change in procedure in assessing for Schedule A. If the party to which I belong, and the party of the right hon. Gentleman, had been here in full force, the Chancellor of the Exchequer would have been faced with the embarrassing
situation of being defeated. I think he should respect the opinion of the Committee. The proceedings on the Bill have now reached a friendly situation in which compromise is possible, and there was a compromise ready made for him. The fifth Amendment, which was not called, provides that, although there shall be a separate assessment by the Income Tax authorities, all the rights of appeal which existed before under the Valuation (Metropolis) Act, 1869, shall continue in force.

The CHAIRMAN: I hope the hon. Member is not going to argue the Amendment that was not called. That would be out of order. What he has to do now is to give reasons for or against the Clause as it stands.

Mr. MARJORIBANKS: I think I can argue exactly the same point and keep in order by being a little more indirect. The Clause would be more acceptable to me if the provisions with regard to the appeal under the Valuation (Metropolis) Act were still to be in force. Even if there were to be a separate assessment by Income Tax officials, if there was an independent appeal to the Courts this would be a far more justifiable Clause. I argued at considerable length the shortcomings and the antiquated jurisprudence lying behind an appeal to the General Commissioners as opposed to an appeal to Quarter Sessions. I pointed out the deficiencies of this appeal. My first objection was one of principle, that the General Commissioners, as well as being the judges, would in some respects be the witnesses. It provides that the tribunal itself shall take into consideration its own special knowledge on the matter. I do not see how that really can be right. The General Commissioners may be excellent people and they may have complete knowledge of their subject, but if they are prejudiced from the start and are employed to use their own special knowledge, without any rules of evidence, and to consider the dispute before them without having any regard to the evidence brought forward from one or other department, I cannot think that can be right, and that is the appeal that is now given to the General Commissioners. Some unfortunate taxpayer might be misled into demanding, as he can do by the Finance Act of 1923, the
opinion of an expert valuer. I have done some of his work, and I know that the maxim about the expert witness has some justification. In fact, I have seldom seen an expert witness on a question of value not contradicted in everything he says. I have never known an expert witness not contradicted by another on the other side. If the taxpayer thinks he is going to get any justice by appealing to the valuation of an expert, he is very much mistaken. It would be infinitely better if, contrary to the provisions of this Clause, the taxpayer, though there might be a separate assessment, could go to the Courts and have the issue tried by a properly constituted Court and have evidence tendered by both sides.
There is another matter to which the Chancellor did not pay very much attention. He said it was hardly worth considering and it could not arise. That is the position of the Old Age Pensioner of the old time. I cannot see how he can sweep that aside. There will certainly be some cases of this kind, though we may count them on the fingers of our hands. The original Old Age Pensioner has a means qualification. Many of these men lived under the old régime under which a beneficent employer would perhaps give him a house to live in. If the assessment goes up, as it must, it would very likely give him a means disqualification which would debar him from his Old Age Pension. This Government especially could ill face the grievance which would arise even from one single case of this kind, and the right hon. Gentleman would be well advised at a later stage to consider the implication of the Old Age Pensioner, because it would be a monstrous injustice to debar a single person from an Old Age Pension after he had enjoyed one by such a provision, which the Chancellor himself says is merely to raise revenue.
I have kept my strongest point to the last. It is one which the Chancellor and the Financial Secretary have entirely failed to answer. I put it in a prominent place in my original argument. He said throughout that his whole object in introducing this change is to promote uniformity. He must see that there would be far less uniformity between London and the provinces when
the Clause comes into effect than now. In the provinces the officials who assess real property for Schedule A are appointed independently by the general commissioners of Income Tax. They are not in any way to be confused with tax gatherers. Their duty is to protect the taxpayer, as much as to see that the proper revenue is raised. The assessors are appointed by them and in London it is apparently to be the tax gatherers, Somerset House officials, who are to assess real property. The very fact that the right hon. Gentleman says there is only going to be an increased expenditure of £15,000 proves that he must have the machinery at his back at present to bring about this change. How can you say you will have a uniform system when, in the country, certainly, the people who value real property are independent and are appointed by the general commissioners, whereas in London they are officials from Somerset House and collectors of taxes? I should be glad to think this is not true, but I can see nothing that shows that it is not true.
Hon. Members opposite who represent London constituencies are in a difficulty in the matter. They have their instructions from headquarters. They have been silent, and we know that opinion is divided. You have to read the debates on the Rating and Valuation Act, 1925, to see how great is that difference. Not a single London Member has got up and expressed his opinion at all apart from occupants of the Front Bench. No doubt their constituents will have something to say with regard to this dereliction of their duty. The hon. Gentleman the Member for Limehouse the present Chancellor of the Duchy of Lancaster (Mr. Attlee) has not raised his voice on this occasion, nor has the voice of other hon. Members been raised in support of single valuation. If there is any representative of a London constituency present on the benches opposite, I ask him whether he cannot contribute to a useful discussion on this matter.
I ask the Chancellor of the Exchequer to answer me (a) whether it is to be the Surveyors of Taxes, who are officials of Somerset House, who are to carry out the valuation in London in future under the new Clause, (b) whether the position
in the country is not, as it always has been, one of independent assessors appointed by general commissioners and whether they will not perform the same duty, and (c) whether he can call that uniformity. If he answers the questions and says that Somerset House is not to be responsible for this new valuation in the future, I shall desire to ask him who is to be appointed and what provision has been made in this Measure to set up certain machinery. After he has answered those questions, hon. Members will be enlightened. I am sorry for having spoken at such length, but the right hon. Gentleman has not really addressed himself to the difficulties of the situation. We all know that what he desires is to raise revenue, and I think that the country ought to know that responsibility rests upon him and upon his Government, and that when assessments come up next year it will not only be the limited class whom the Chancellor has chosen now for the purpose of imposing an increase of sixpence on the Income Tax who will be affected by this matter. Not only may people in that class be affected, but even the poorest of the poor, the old age pensioner under the original Act, may be affected.

Mr. SMITHERS: I desire to raise one or two points in connection with this Clause and to support the remarks made by the hon. and gallant Member for North-East Bethnal Green (Major Nathan) a little earlier in the debate on the question "That the Clause stand part of the Bill." I do not often find myself in agreement with a Liberal, but there are Liberals and Liberals, and on this occasion the hon. and gallant Member has made a point of great substance. He argued that Clause 26 should not have been included in the Finance Bill at all and that it would have been more properly placed in the Rating and Valuation Act. I protest against the inclusion in a Finance Bill of Clauses which are not strictly finance Clauses. The Chancellor of the Exchequer and some of the permanent officials on the administrative side of our Government take the opportunity under a Finance Bill, which is exempted business, to introduce proposals which are more likely to be passed into law than if they came in an ordinary Bill in regard to which discussion has to stop at eleven
o'clock. They are putting in machinery and administrative proposals which have no right to be in a Finance Bill at all. The hon. and gallant Member for North-East Bethnal Green was correct when he said that the country outside were asking what were we doing in the House of Commons by not giving out attention to the great problem before the country but spending our time trying to pass into law such tightening up provisions as are included in this Clause.
Having said this against the right hon. Gentleman, I want to thank him for one thing in regard to which he has helped us. As ratepayers of the City of London, we called his attention to a unique position existing in the City. I suppose that nowhere else in the world, except perhaps possibly in New York, though I do not know whether it is a fact, are there such enormous blocks of buildings of such tremendous value as can be found in the City of London. Either private individuals or land and building companies hold these blocks of buildings and let them out in separate suites of offices of from two up to sometimes 20 or 30 rooms. The question was raised during a debate on an Amendment in the name of my hon. and gallant Friend the Member for Clitheroe (Sir W. Brass) that it seemed unfair that where some of the suites of offices in these buildings were unoccupied for a year or portion of a year they should be subject to valuation for Income Tax purposes. I am representing this position now, because I want to get the matter made clear, namely, that the Chancellor of the Exchequer stated that any previous Income Tax Acts which gave relief to "empties," as they are called, and to the running of lifts for the services of all the offices was still to be given as relief in the payment of Income Tax in respect of the income derived from those buildings. I can assure the Financial Secretary that I have done my best to give a true account of what the Chancellor of the Exchequer said. I believe that to have been the effect of it, and I want it to be placed on record that in the case of blocks of buildings where suites are unlet there shall be granted the same relief in respect of "empties" and lifts as hitherto.
The argument of my hon. and learned Friend the Member for Altrincham (Mr.
Atkinson) in regard to separate valuations in London was unanswerable. He pointed out that you require valuation for two purposes, valuation for the purposes of rates and valuation for the purposes of taxes. The valuation is identical for both purposes. If the valuation is wrong, why not have a revaluation? But having got that revaluation, let it serve for the double purpose. I have heard it suggested that this Clause has been introduced—I wish to say at once that it is an unworthy suggestion—to try and give more employment in this work. I understand that the Chancellor of the Exchequer in his earlier days in the Civil Service was occupied in this particular Department. I suppose it is a case of the poacher turning gamekeeper. [HON. MEMBERS "Order!"] I say this with respect. Surely, every hon. Member must know that that expression is an ordinary expression. There is no offence intended, I can assure hon. Members. I will put it in another way. What I mean is, that, having been engaged in the Civil Service, he knows all about the work, and I have heard it suggested that this proposal has been brought in to try and increase work for that branch of the Civil Service. I cannot see the use of the Clause. I think that it will prove to be redundant work which might very well be left undone. It will mean an increase of expense to the taxpayer, and I shall not support this Clause in the Division Lobby.

Lieut.-Colonel HENEAGE: I should like to say a few words from the point of view not of a man who lives in London, but as one who sometimes has had to take a flat in London. My experience is this, that as soon as you begin touching the owners of houses, whether in regard to income or revaluation, they pass it on to the tenant. Immediately the landlord tries to alter the lease, possibly he has to give the tenant a certain amount of inducement to do so, but he suggests that the tenant should take on some of the burdens which the Chancellor of the Exchequer proposes to place upon the landlord. I am very much afraid that the Chancellor of the Exchequer will find that the burdens which, apparently, he is putting upon the landlord will be very quickly passed on to the smaller occupier and tenant. I
see that going on now. On going through the streets I see a great increase in the notice boards of houses to let. That might at first sight seem to be a good thing, but when one comes to investigate the terms at which these houses are to be let then one can see the heavy weight of the Chancellor of the Exchequer not only on the landlord, but on the tenant.
Another effect of this Clause is that people who have an interest in property in London are proposing to clear out and take their capital with them. Sometimes they go abroad and sometimes they go to the Free State, where Income Tax and Super-tax are very much less than they are here. I am afraid that the Chancellor of the Exchequer will not get the money that he thinks he will get by these alterations. It sounds reasonable to make the valuation in London more or less on a par with that which prevails in the country, but from the experience that we have had in Lincolnshire with regard to revaluation I see a great many difficulties. It would be a good idea to postpone the revaluation in London for two or three years, in order to see the experience in the country districts and also to let the London valuers have the benefit of the experience of the country districts. The Chancellor of the Exchequer would be well advised even now

to postpone this Clause for two or three years.

Mr. A. M. SAMUEL: Will the Financial Secretary to the Treasury tell us how he gets the figure of £15,000 as the extra expense to be incurred for revaluing the vast number of houses in the administrative area of London, which has a population nearly as big as that of Canada? A sum of £15,000 means, say, 15 valuers, with nothing for office expenses. It may be that he will say that a great deal of the information is already in the hands of the municipalities, or at Somerset House, but I cannot believe—I am not doubting his personal word—that £15,000 can cover in any way the expenses for carrying out what is implied in this Clause. I hope that the Financial Secretary will take counsel with his staff, and tell us how he gets at the figure of £15,000.

Mr. PETHICK-LAWRENCE: The £15,000 is the additional cost over and above what is at present required to carry out the valuation.

Mr. SAMUEL: I understand that there are 700,000 or 800,000 properties to be revalued. It would almost take a lifetime for 15 men to do that work. There must be some mistake in calculation.

Question put, "That the Clause stand part of the Bill."

The Committee divided: Ayes, 249; Noes, 139.

Division No. 385.]
AYES.
[9.0 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Brown, C. W. E. (Notts, Mansfield)
Elmley, Viscount


Adamson, W. M. (Staff., Cannock)
Brown, Ernest (Leith)
Freeman, Peter


Addison, Rt. Hon. Dr. Christopher
Brown, Rt. Hon. J. (South Ayrshire)
Gardner, B. W. (West Ham, Upton)


Aitchison, Rt. Hon. Craigie M.
Brown, W. J. (Wolverhampton, West)
Gardner, J. P. (Hammersmith, N.)


Alexander, Rt. Hon. A. V. (Hillsbro')
Burgess, F. G.
Gibbins, Joseph


Ammon, Charles George
Burgin, Dr. E. L.
Gibson, H. M. (Lancs. Mossley)


Arnott, John
Caine, Derwent Hall-
Gill, T. H.


Aske, Sir Robert
Cameron, A. G.
Gossling, A. G.


Attlee, Clement Richard
Cape, Thomas
Gould, F.


Ayles, Walter
Carter, W. (St. Pancras, S. W.)
Graham, Rt. Hon. Wm. (Edin., Cent.)


Baker, John (Wolverhampton, Bilston)
Charleton, H. C.
Granville, E.


Baldwin, Oliver (Dudley)
Chater, Daniel
Gray, Milner


Barnes, Alfred John
Church, Major A. G.
Grenfell, D. R. (Glamorgan)


Barr, James
Cluse, W. S.
Griffith, F. Kingsley (Middlesbro' W.)


Batey, Joseph
Clynes, Rt. Hon. John R.
Griffiths, T. (Monmouth, Pontypool)


Bellamy, Albert
Cocks, Frederick Seymour
Grundy, Thomas W.


Benn, Rt. Hon. Wedgwood
Compton, Joseph
Hall, F. (York, W. R., Normanton)


Bennett, Capt. Sir E. N. (Cardiff C.)
Cove, William G.
Hall, G. H. (Merthyr Tydvil)


Bennett, William (Battersea, South)
Daggar, George
Hall, Capt. W. P. (Portsmouth, C.)


Benson, G.
Dallas, George
Hardie, George D.


Bentham, Dr. Ethel
Dalton, Hugh
Harris, Percy A.


Birkett, W. Norman
Day, Harry
Hartshorn, Rt. Hon. Vernon


Blindell, James
Denman, Hon. R. D.
Hastings, Dr. Somerville


Bondfield, Rt. Hon. Margaret
Dickson, T.
Haycock, A. W.


Bowen, J. W.
Duncan, Charles
Hayday, Arthur


Bowerman, Rt. Hon. Charles W.
Ede, James Chuter
Hayes, John Henry


Brockway, A. Fenner
Edmunds, J. E.
Henderson, Arthur, Junr. (Cardiff, S.)


Bromfield, William
Edwards, C. (Monmouth, Bedwellty)
Henderson, Thomas (Glasgow)


Brooke, W.
Edwards, E. (Morpeth)
Henderson, W. W. (Middx., Enfield)


Brothers, M.
Egan, W. H.
Herriotts, J.


Hirst, G. H. (York W. R. Wentworth)
Middleton, G.
Short, Alfred (Wednesbury)


Hirst, W. (Bradford, South)
Mills, J. E.
Simmons, C. J.


Hoffman, P. C.
Milner, Major J.
Simon, E. D. (Manch'ter, Withington)


Hollins, A.
Montague, Frederick
Sinkinson, George


Hopkin, Daniel
Morgan, Dr. H. B.
Sitch, Charles H.


Horrabin, J. F.
Morley, Ralph
Smith, Frank (Nuneaton)


Hudson, James H. (Huddersfield)
Morris, Rhys Hopkins
Smith, H. B. Lees- (Keighley)


Hunter, Dr. Joseph
Morris-Jones, Dr. J. H. (Denbigh)
Smith, Tom (Pontefract)


Jenkins, W. (Glamorgan, Neath)
Morrison, Herbert (Hackney, South)
Smith, W. R. (Norwich)


John, William (Rhondda, West)
Mort, D. L.
Snell, Harry


Jones, F. Llewellyn- (Flint)
Moses, J. J. H.
Snowden, Rt. Hon. Philip


Jones, Henry Haydn (Merioneth)
Mosley, Lady C. (Stoke-on-Trent)
Snowden, Thomas (Accrington)


Jones, Morgan (Caerphilly)
Mosley, Sir Oswald (Smethwick)
Sorensen, R.


Jowett, Rt. Hon. F. W.
Muff, G.
Stamford, Thomas W.


Jowitt, Rt. Hon. Sir W. A.
Muggeridge, H. T.
Strauss, G. R.


Keily, W. T.
Murnin, Hugh
Sutton, J. E.


Kennedy, Thomas
Naylor, T. E.
Taylor, R. A. (Lincoln)


Kenworthy, Lt.-Com. Hon. Joseph M.
Newman, Sir R. H. S. D. L. (Exeter)
Thorne, W. (West Ham Plaistow)


Knight, Holford
Noel Baker, P. J.
Thurtle, Ernest


Lang, Gordon
Oldfield, J. R.
Tillett, Ben


Lathan, G.
Oliver, George Harold (Ilkeston)
Tinker, John Joseph


Law, A. (Rosendale)
Oliver, P. M. (Man., Blackley)
Toole, Joseph


Lawrence, Susan
Owen, Major G. (Carnarvon)
Tout, W. J.


Lawson, John James
Palin, John Henry
Townend, A. E.


Lawther, W. (Barnard Castle)
Paling, Wilfrid
Trevelyan, Rt. Hon. Sir Charles


Leach, W.
Palmer, E. T.
Vaughan, D. J.


Lee, Frank (Derby, N. E.)
Perry, S. F.
Viant, S. P.


Lee, Jennie (Lanark, Northern)
Pethick-Lawrence, F. W.
Walkden, A. G.


Lees, J.
Phillips, Dr. Marion
Walker, J.


Lewis, T. (Southampton)
Pole, Major D. G.
Wallace, H. W.


Lindley, Fred W.
Potts, John S.
Wallhead, Richard C.


Logan, David Gilbert
Price, M. P.
Walters, Rt. Hon. Sir J. Tudor


Longbottom, A. W.
Pybus, Percy John
Watkins, F. C.


Longden, F.
Raynes, W. R.
Watson, W. M. (Dunfermline)


Lowth, Thomas
Richards, R.
Watts-Morgan, Lt.-Col. D. (Rhondda)


Lunn, William
Richardson, R. (Houghton-le-Spring)
Welsh, James (Paisley)


Macdonald, Gordon (Ince)
Riley, Ben (Dewsbury)
Welsh, James C. (Coatbridge)


MacDonald, Malcolm (Bassetlaw)
Riley, F. F. (Stockton-on-Tees)
West, F. R.


McElwee, A.
Ritson, J.
White, H. G.


McEntee, V. L.
Roberts, Rt. Hon. F. O. (W. Bromwich)
Whiteley, Wilfrid (Birm., Ladywood)


McKinlay, A.
Romeril, H. G.
Whiteley, William (Blaydon)


MacLaren, Andrew
Rosbotham, D. S. T.
Wilkinson, Ellen C.


Maclean, Neil (Glasgow, Govan)
Rowson, Guy
Williams, Dr. J. H. (Llanelly)


MacNeill-Weir, L.
Russell, Richard John (Eddisbury)
Williams, T. (York, Don Valley)


McShane, John James
Salter, Dr. Alfred
Wilson C. H. (Sheffield, Attercliffe)


Malone, C. L'Estrange (N'thampton)
Sanders, W. S.
Wilson, J. (Oldham)


Mansfield, W.
Sawyer, G. F.
Wilson, R. J. (Jarrow)


March, S.
Scrymgeour, E.
Winterton, G. E. (Leicester, Loughb'gh)


Marcus, M.
Scurr, John
Wise, E. F.


Marley, J.
Sexton, James
Wood, Major McKenzie (Banff)


Marshall, Fred
Shaw, Rt. Hon. Thomas (Preston)
Young, R. S. (Islington, North)


Mathers, George
Shepherd, Arthur Lewis



Matters, L. W.
Shield, George William
TELLERS FOR THE AYES.—


Messer, Fred
Shillaker, J. F.
Mr. Allen Parkinson and Mr. Hayes.


NOES.


Acland-Troyte, Lieut.-Colonel
Davies, Dr. Vernon
Hannon, Patrick Joseph Henry


Astor, Viscountess
Davies, Maj. Geo. F. (Somerset, Yeovil)
Harvey, Major S. E. (Devon, Totnes)


Atholl, Duchess of
Davison, Sir W. H. (Kensington, S.)
Heneage, Lieut.-Colonel Arthur P.


Atkinson, C.
Dixey, A. C.
Hennessy, Major Sir G. R. J.


Balfour, George (Hampstead)
Dixon, Captain Rt. Hon. Herbert
Herbert, Sir Dennis (Hertford)


Balfour, Captain H. H. (I. of Thanet)
Eden, Captain Anthony
Hills, Major Rt. Hon. John Waller


Beamish, Rear-Admiral T. P. H.
Edmondson, Major A. J.
Hope, Sir Harry (Forfar)


Betterton, Sir Henry B.
Elliot, Major Walter E.
Hore-Belisha, Lesile


Birchall, Major Sir John Dearman
Everard, W. Lindsay
Hunter-Weston, Lt.-Gen. Sir Aylmer


Bird, Ernest Roy
Falle, Sir Bertram G.
Hutchison, Maj.-Gen. Sir R.


Bourne, Captain Robert Croft
Ferguson, Sir John
Iveagh, Countess of


Boyce, H. L.
Fielden E. B.
Jones, Sir G. W. H. (Stoke New'gton)


Brass, Captain Sir William
Fison, F. G. Clavering
Jones, Rt. Hon Leif (Camborne)


Brown, Col. D. C. (N'th'l d'., Hexham)
Forestler-Walker, Sir L.
Kindersley, Major G. M.


Butt, Sir Alfred
Fremantle, Lieut-Colonel Francis E.
King, Commodore Rt. Hon. Henry D.


Cadogan, Major Hon. Edward
Galbraith, J. F. W.
Knox, Sir Alfred


Carver, Major W. H.
Glassey, A. E.
Lamb, Sir J. Q.


Cazalet, Captain Victor A.
Gower, Sir Robert
Leighton, Major B. E. P.


Chamberlain, Rt. Hon. N. (Edgbaston)
Graham, Fergus (Cumberland, N.)
Llewellin, Major J. J.


Cobb, Sir Cyril
Grattan-Doyle. Sir N.
Locker-Lampson, Rt. Hon. Godfrey


Colfox, Major William Philip
Greene, W. P. Crawford
Long, Major Eric


Courtauld, Major J. S.
Grenfell, Edward C. (City of London)
Lymington, Viscount


Courthope, Colonel Sir G. L.
Gretton, Colonel Rt. Hon. John
McConnell, Sir Joseph


Crookshank, Capt. H, C.
Gritten, W. G. Howard
Maitland, A. (Kent, Faversham)


Croom-Johnson, R. P.
Gunston, Captain D. W.
Makins, Brigadier-General E.


Culverwell, C. T. (Bristol, West)
Hacking, Rt. Hon. Douglas H.
Margesson, Captain H. D.


Dalkeith, Earl of
Hall, Lieut.-Col. Sir F. (Dulwich)
Marjoribanks, E. C.


Dalrymple-White, Lt.-Col. Sir Godfrey
Hammersley, S. S.
Meller, R. J.




Merriman, Sir F. Boyd
Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Stewart, W. J. (Belfast, South)


Millar, J. D.
Ross, Major Ronald D.
Stuart, Hon. J. (Moray and Nairn)


Mond, Hon. Henry
Ruggles-Brise, Lieut.-Colonel E. A.
Thomas, Major L. B. (King's Norton)


Monsell, Eyres, Com. Rt. Hon. Sir B.
Russell, Alexander West (Tynemouth)
Thomson, Sir F.


Moore, Sir Newton J. (Richmond)
Salmon, Major I.
Tinne, J. A.


Morden, Col. W. Grant
Samuel, A. M. (Surrey, Farnham)
Titchfield, Major the Marquess of


Morrison, W. S. (Glos., Cirencester)
Samuel, Samuel (W'dsworth, Putney)
Tryon, Rt. Hon. George Clement


Morrison-Bell, Sir Arthur Clive
Sandeman, Sir N. Stewart
Turton, Robert Hugh


Nathan, Major H. L.
Sassoon, Rt. Hon. Sir Philip A. G. D.
Wallace, Capt. D. E. (Hornsey)


O'Connor, T. J.
Scott, James
Ward, Lieut.-Col. Sir A. Lambert


Oman, Sir Charles William C.
Shepperson, Sir Ernest Whittome
Wardlaw-Milne, J. S.


Peake, Capt. Osbert
Skelton, A. N.
Wayland, Sir William A.


Penny, Sir George
Smith, Louis W. (Sheffield, Hallam)
Wells, Sydney R.


Percy, Lord Eustace (Hastings)
Smith, R. W. (Aberd'n & Kinc'dine, C.)
Windsor-Clive, Lieut.-Colonel George


Peto, Sir Basil E. (Devon, Barnstaple)
Smith-Carington, Neville W.
Womersley, W. J.


Pilditch, Sir Philip
Smithers, Waldron



Ramsay, T. B. Wilson
Somerville, A. A. (Windsor)
TELLERS FOR THE NOES.—


Rawson, Sir Cooper
Spender-Clay, Colonel H.
Captain Sir George Bowyer and Sir Victor Warrender.


Reid, David D. (County Down)
Stanley, Lord (Fylde)



Reynolds, Col. Sir James
Steel-Maitland, Rt. Hon. Sir Arthur



Question, "That the Clause, as amended, stand part of the Bill," put, and agreed to.

CLAUSE 27.—(Provisions with respect to returns, copies of valuation lists and tax assessments in London.)

Mr. PALMER: I beg to move, in page 23, line 9, at the end, to insert the words:
(2) In the said section fifty-five, for the words from 'such statement' to the end of the section there shall be substituted the words a return in such form as may be prescribed by the Minister of Health, in pursuance of his powers in that behalf, and containing such particulars as may be reasonably required for the purpose of carrying out this Act and the Acts incorporated therewith.'
This is a machinery Amendment, and, having regard to the protracted discussion on the previous Clause, I do not propose to take up the time of the Committee. This affects London only and is in accordance with the desires of the London County Council and the Metropolitan Boroughs Standing Joint Committee. The Metropolitan authorities acquiesce in the desire of the Government that on grounds of economy and convenience the form of return for rating purposes shall also serve for the purposes of Income Tax, but there are certain questions which are necessary for rating purposes in addition to those required for Income Tax purposes, and this, and consequential Amendments, is designed to enable these questions to be added to the form of return. It does not add or detract from the revenue. It is simply a matter of machinery.

Mr. PETHICK-LAWRENCE: My right hon. Friend has had an opportunity of considering this Amendment and he agrees that the point embodied in it is one which ought to be so embodied; and
he has pleasure therefore in accepting the Amendment and the Amendments which are consequential thereto.

Amendment agreed to.

Further Amendments made:

In page 23, line 11, leave out the words
the last preceding.

In page 23, line 11, after the word "Sub-section," insert the words "(1) of this Section."

In page 23, line 12, leave out from the word "him," to the word "but," in line 15, and insert instead thereof the words:
until the first day of July next following the first day of April referred to in that sub-section."—[Mr. Palmer.]

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

Sir K. VAUGHAN-MORGAN: I wish to ask the Financial Secretary for a word of explanation as to the time during which the valuation list has to remain in the custody of the surveyor of Taxes. The Bill as drafted uses the expression, "So long as may be necessary." In place of that an Amendment has been accepted to meet the wishes of the London County Council, but I think that a word of explanation from the Financial Secretary to the Treasury would not be out of place, as to how far the time provided is satisfactory, and what difference it will make to the annual time-table, which, I understand, extends from February until the following April.

Mr. PETHICK-LAWRENCE: As I understand the matter the difficulty foreseen by the hon. Member has been met by the Government's acceptance of the Amendment which has just been agreed to.

CLAUSE 28.—(Amended rates of Estate Duty.)

The CHAIRMAN: The first Amendment in the name of the hon. Member for Leominster (Sir E. Shepperson)—in page 23, line 38, at the end, to insert the words:
Provided always that there shall be no increase in the rate of estate duty charged upon agricultural land
—I do not select.

Sir ERNEST SHEPPERSON: On a point of Order. Do I understand that the Amendment is out of order?

The CHAIRMAN: That is an unnecessary point of Older. I said that I did not select the Amendment. The next two Amendments on the Paper, in the name of the hon. Member for Barnstaple (Sir B. Peto), should be put on the Paper as new Clauses.

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Mr. T. O'CONNOR: I think it right to call attention to the progress in the pernicious principle of increasing the Death Duties. There might be something to be said for an increase of Death Duties if the State was replacing this source of new capital for industry and the general needs of the country by reservoirs of capital which would perform a similar function; but in practice the pernicious principle to which I call attention, which has been indulged in by successive Governments, has meant that the large estates which have been the source of the fructification of industry and the source of the re-equipment of our machinery and industrial efficiency are used, not for the purpose for which they were previously used, but merely to be drawn into the general stream of income. That cannot be good for any country. I can understand the full Socialist thesis that the State itself ought to supply itself with reservoirs of capital. There is something to be said for that. But there is nothing to be said for taking the capital reservoirs of the country, exhausting them, and putting nothing whatever in their place. For that reason any increase in the already onerous Estate Duties is a
most retrograde move, and is one of the things that is causing most concern to industry at the present time.
Another thing I would press upon the Government. This is an exhaustible and indeed exhausting form of revenue. We are now receiving the benefit of the large fortunes that were accumulated at a time when this country enjoyed very great industrial prosperity. That source will dry up. I have not the smallest doubt that if a careful actuarial investigation were undertaken it would be found that the revenue from Death Duties will begin to diminish very rapidly within the next few years, and that in the course of the next 25 years the yield from these particular duties will be very much smaller than it is now. So in the principle that is involved in this Clause the Government are really embarking on a process which is dangerous for two reasons. They are, first of all, taking away from industry the reservoirs that have hitherto supplied it; and, secondly, they are relying for an increasingly large proportion of general revenue on a source which is drying up with alarming rapidity.
One does not want to over-emphasise the first of these points, although it is a very serious one indeed. What is it that we need in this country especially, if we are to restore employment to anything like the rate that we wish to see? We want more money, not less, available for capital purposes for re-equipping industry and bringing it up to date. We are constantly deploring the fact that we cannot compete in our home market or in the markets of the world against the much better equipment that exists in foreign countries. We cannot re-equip our industries to face the world competition. Yet all the time we are exhausting the one reservoir that could be used for the purpose of re-equipping our industries. We are exhausting that reservoir without putting anything in substitution for it. It is the easiest possible and most tempting method by which hon. Gentlemen opposite can attempt to make ends meet, but it is the most dangerous and potentially unsocial method, and most inimical to the real interests of industry, which demand that capital should be available freely for industry to refresh itself.
You are also obviously striking at one of the most potential weapons for the
continuity and stability of society. There is nothing that conduces so much in a beneficial, social, way to the continuance of a stable order of society, in which the whole principle of private ownership is involved, as that at your death you should be able to pass on what you have accumulated to your children. That is a respectable and completely social motive. An attack on that motive, if it becomes predatory and punitive in the sense that the present scales of Death Duties are, is an attack on a principle which is respectable and social and which is of the greatest advantage to the stability of the whole community. If one had to select one portion of this Finance Bill which, above all others, is open to attack on either the principle of common sense or sound economics, one would seize on this increase in the Death Duties. Indeed, I find less to complain if the Chancellor of the Exchequer increases the revenue taxes and the Income Tax, but, when he is driven to this expedient of vastly increasing taxes which we, on this side, think are already far too heavy, I think prudence counsels that the dangers of the step should be pointed out.
There is another feature of this increase in Death Duties to which I would also call attention. One might have expected from a Socialist Government, which presumably believes in the public ownership of property, that at least it would have recognised the principle of accepting payments in kind, and that if hon. Gentlemen opposite really believe that the State can make good use of property and can manage it better than the individual can, they would accept payment of the capital that passes at death in the form of land, goods or shares, so that the State would thus take a share in the ownership of land and in the hazards of industry. Side by side with these large increases in the duties, there is in the present Finance Bill no machinery whatsoever whereby the State can receive payment in kind, either in land, shares, or any other form of estate. In the case of agricultural land, the effect of the method of Death Duties is, of course, disastrous. It can only result in the liquidation of property which is passed on so that it must mean the break up of the estate. That means
a reduction of a more economic unit to a less economically manageable unit. In the case of companies very much the same thing occurs. If, for example, you take the many private companies which exist, in which most of the shares are held by a limited number of persons coming from the same family and who have been long associated with the business and know the workpeople intimately, what do you find at their death? At the death of such an individual the company must, in fact, be turned into a public company in order that the shares can be realised on the open market and all the advantages of that contact between employer and employed, which you find in the limited area of the private liability company, disappear, and the shares are thrown on the open market in order that by forced sale the owners may secure the means with which to pay the toll to the State.
The State will not take its part of the shares or assume any share of responsibility in the matter. It is simply a ruthless machine forcing into liquidation interests which are valuable to the community in order to grind out revenue for delivery and distribution to the public in the form of ever expanding doles and social services. Anything more inimical to the conservation of our resources than the savage and exaggerated Death Duties, it is difficult to conceive. It is because these duties are increased in these Clauses and no step whatsoever is taken to substitute capital for the reserves that are being exhausted, because no alteration is made in the method of levying the toll, and because the tax is not collected in kind or by methods which mean the conservation of our resources, that I consider a strong protest ought to be made against the Clause standing part of the Bill.

Sir E. SHEPPERSON: I rise for a few moments to protest against the increase of these duties. I would like, in making my protest against the increases generally, to emphasise the case against the increase in the Death Duties upon agricultural land. I do submit to the Committee that the increase of these duties upon agricultural land is worthy of very serious consideration. We all know the terrible depression through which the agricultural industry is passing at the present
time and the inability of the industry to pay its way. Agriculture is composed of three partners—and equal partners—the agricultural labourer, the farmer himself and the agricultural landlord. The agricultural labourer is suffering acutely from unemployment and low wages, but the effect of the depression is not merely felt by the agricultural labourer and the farmer, but also by the other partner, the agricultural landlord. The agricultural landlord is a partner who has a function to perform in maintaining the buildings and instituting internal drainage work and so on. At present he is unable properly to perform those functions. If you take his money from him in the form of Death Duties, you are taking from him the money which he normally would be able to put into the land in order to maintain it in a proper state of cultivation. I appeal to the Financial Secretary, if he cannot accept the maintenance of the whole of the Estate Duties at the present rate, as they affect other indusries, that he should give special consideration to the case of agricultural land, owing to the very depressed condition of agriculture at the present time. There are precedents for an action of this description. Objects of national importance are not subject to Estate Duty, and I contend that agricultural land is of national importance.

Mr. PETHICK-LAWRENCE: Perhaps it may save the time of the Committee if the hon Member will allow me to explain that what he is saying is evidently being said under an entire misapprehension. The provision in this Clause does not alter the Estate Duty on agricultural land. Under the Finance Act of 1925 the rates of Estate Duty on the agricultural value of land were left unaltered when the general level of the duty was raised by the fourth Schedule to that Act. It is only that Schedule which is now being altered, and therefore there is no increase in Estate Duty on agricultural land proposed under this Clause such as the hon. Member quite erroneously supposes. I make that statement now in order to save him the trouble of arguing a case which is already met under the provisions of the Bill.

Sir E. SHEPPERSON: The information which I have just received gives me great gratification. May I ask the Financial Secretary if I am right in assuming
that the rates of Estate Duty laid down originally in the Finance Act of 1919 and raised in the Act of 1925, by the predecessor of the right hon. Gentleman the present Chancellor of the Exchequer, remain unchanged. I wish to make it quite clear that the position under that Act in reference to Estate Duty and special relief in the case of agricultural land stands good, and that under the present Bill there is no possibility of an increase in Estate Duty on agricultural land. That assurance will give great gratification not only to myself but to members of the agricultural community generally who have been in some doubt upon the matter.

Mr. PETHICK-LAWRENCE: The position is that the Bill preserves and continues the concession granted in the Act of 1925 which applied to the agricultural value of agricultural land and exempted that value from the rates of duty imposed by the late Chancellor of the Exchequer. The present Bill only applies to the rates which were imposed by the late Chancellor of the Exchequer and leaves untouched that concession.

Sir E. SHEPPERSON: In those circumstances, I think I should be acting honourably towards the Committee by not proceeding further with my speech.

Captain GUNSTON: I think my hon. Friend has been rather taken in by the Treasury because, if I remember aright, the Chancellor of the Exchequer did say on a previous occasion that the Duty on agricultural land was not raised, but the reason given was because fresh legislation was to be brought in, and he left us with the impression that we would rather like to see that fresh legislation before coming to any conclusion. Apart from that consideration I think that this proposal does affect agricultural land. No landlord at present can live on what he gets from his rents; he can only act as a landlord on capital which is derived from other sources, and, therefore, the raising of the Death Duties does affect the agricultural industry very seriously indeed. The hon. and learned Member for Central Nottingham (Mr. O'Connor) has pointed out the difficulties and the ill-effects of Death Duties in the case of ordinary estates, but the effects are much more serious in relation to agricultural land. Shares in a company can be sold to meet Death Duties but one cannot
sell shares in a farm or in landed property. The only alternatives are either to raise a mortgage or else sell the land. I am not a landlord and never have been, and the reason why I object to Death Duties on land is because they hit the farming industry first of all. If the landowner raises the money to meet Death Duties by a mortgage it means that he has to pay the interest on the mortgage and thus he has less money to spend on ditching and hedging and draining and maintaining the land generally. Everybody knows that one of the reasons why farming is doing so badly to-day is because the land is not being maintained as it used to be owing to the results of taxation.
The other way of meeting this charge in the case of land is by selling the land. What happens in that case? The tenant usually wants to buy and the landlord generally tries to meet him and offers him a first option on the land. But the tenant in order to buy the land has to raise a mortgage and has to pay, in interest on the mortgage, money which otherwise he would be putting into farming operations. In that way agriculture is very seriously hit. There is another point which hon. Members opposite I know do not take very seriously but which is serious to the people in the country. If the land is hit very heavily in this way, the result is that nobody will buy land. If the landlord cannot get a return in rents for land used for farming then the land will only appeal by reason of its social or sporting amenities. A man who has made money in other walks of life will buy land for its sporting amenities and I do not think that even the Labour party desire to encourage that sort of thing. The 1909 Budget by taxing the landlord actually hit the farming community harder than the landlords because the landlords realising what was coming could sell out and invest his money in other businesses. The good landlords who held on are now being driven out.
What is the result to-day? Throughout the country farmers are being compelled to buy their land with the result that they are heavily mortgaged and cannot put the requisite money into their farming operations. Then, again, have the country districts gained from the splitting up of the large estates? In
every part of England one sees the results of this kind of taxation in the case of the good landlords, the landlords who brought in new methods of farming, whose land was properly maintained, who gave ample employment—that many of the ditchers and the hedgers and the other skilled workers who used to be employed in the maintenance of the land can now get no employment because people are economising on the upkeep of the land. The men who suffer most from this taxation are not necessarily the landlord but the labourers and the skilled workmen of the countryside. If the Labour party really believe in the nationalisation of the land, and they used to tell us that they believed in it, why should they not accept the land which is being offered in place of the payment, of Death Duties? I think we might have an answer from the Financial Secretary to the Treasury to that question. If he and his colleagues believe in the nationalisation of the land why not try to prove to the country that the State can farm as well as the landlord?

Major GEORGE DAVIES: It is not very long ago that the expression "capital levy" was on the lips of nearly every hon. Member opposite, but we do not hear so much of that to-day. I wish to draw attention to the fact that the whole system involved in raising revenue by Death Duties is a capital levy by instalments. While it would be possible to argue on that basis that the whole system of Death Duties is fundamentally vicious, one has to admit that by a Constant suffering from that method, it has become one, not of principle, but of degree. In this Clause one more step has been taken in increasing the degree to which the principle of a capital levy by instalments is being applied to industry.
We hear a great deal of the necessity of rationalising industry, and our leaders of industry are criticised for being behind their competitors abroad, particularly in Germany, France, Belgium and the United States of America. We are told that we are slow in adopting new inventions and that that reacts on the prosperity of industry and on the right of labour to gain their living from the efficiency of those who are carrying on industry. If that be so, it
seems only common sense that those responsible for the national system of taxation should encourage anything that would improve the employment of our people and the efficiency of our industry.
An hon. and learned Friend who spoke earlier pointed out some of the menaces to industry if that reservoir of capital was shut off from flowing freely into industry. No industry can continue unless it keeps itself efficient and is constantly expanding. There is no such thing in business as standing still. If you stand still, you stagnate and die. You must constantly be progressing. You must follow a policy of replacement, not only because of new inventions on the market, but because of the wear and tear of existing plant and machinery; and in the same way, if your business wants to live, it wants to expand, to go into fresh lines, and to increase its activities. It is because some other countries have realised that fact that sometimes there is ground for the criticism that our competitors in the world markets have been replacing inefficient plant with efficient plant and have been expanding while we have been, as it were, marking time.
In this Clause we are increasing the instalments of the capital levy, and the question of private enterprise or State control does not arise, because, as has been pointed out by more than one ornament of the Front Bench opposite, the conduct of industry, whether by the State or by the individual, must be broadly on the same lines. It has to be run by capital in somebody's hands. If you denude industry, even if operated by the State, of its necessary power of replacement and expansion, you have the same effect on the employment of the workers of the country as if it had been done by private enterprise. Therefore, when you use taxation in order to redistribute property, you are, while perhaps realising your political ideals, handicapping the giving of employment to our people.
We regard with grave misapprehension the general attitude of the Government an this question of the Death Duties. It is not only the present Chancellor of the Exchequer. There have been sinners in this respect in every party in the State, ever since the scheme was first brought forward in order to raise revenue. I am not a supporter of
the principle of earmarking certain sources of revenue for certain forms of State expenditure, but if ever that could be justified, it would be in the case where you are deliberately taxing, not the revenues, but the capital sums of the country, and using the proceeds, not in paying off debt and reducing the national load, but in using it for revenue purposes.
The present Chancellor of the Exchequer is going a step further in this direction under this Clause. The Financial Secretary to the Treasury has to some extent relieved the anxieties of my hon. Friend the Member for Leominster (Sir E. Shepperson) with regard to its application to agricultural land. It is true that a year ago special provision was made in that connection, and that is not being interfered with now, but the fact remains that if the exhaustion of capital reserves has a deleterious effect on industry, it has an equally, if not greater, deleterious effect on agriculture; and the time has come when the tendency is to realise that it is not correct to talk about industry and agriculture. The two are one.
I had the privilege during the weekend of staying at a farm in this country which is being run on a large scale on the lines of an industrial business, at the highest point of efficiency and of up-to-date machinery. The owner of those acres has the privilege of being on the electric grid, and he is getting his power and applying it in every conceivable direction. At the same time, by certain developments, he has been enabled not only to continue employing the people living in that district, but, by going into other lines, such as fruit and so forth, actually to increase employment and to provide a constantly increasing demand for that kind of labour which the inhabitants of that area are particularly well fitted to give. Therefore, any activity of that sort is a benefit to the community and is doing much to try to stem agricultural depression and unemployment. But all these efforts are made the more difficult by the unnecessary weight of the application of the instalments of capital levy.
In agriculture, more than in anything else, we can see the definite results. All of us who have had the opportunity and responsibility of being closely connected
with agriculture have realised that one of the most direct reasons for agricultural depression and the tragedy of agricultural unemployment, which is rather new to the countryside, is that we have been making it every year more and more difficult for those who are naturally responsible for the provision of capital to that industry to be equal to that responsibility. We in this House have for many years tried to solve the housing problem and have been able to do a great deal, but on all hands it has been admitted that the one exception so far has been the housing of the agricultural countryside. What has been the class of people who have really had the responsibility of providing agricultural housing for the last few hundreds of years? It has been the landowner. It has been part of his responsibility, which he has cheerfully accepted when he has been able to carry it out. Inasmuch as this form of taxation has depleted his capital resources, he has been denied the opportunity of carrying out this responsibility. Like my hon. and gallant Friend who spoke before me, I have the fortune or misfortune to be in a small way what is denounced as a landlord. I have the privilege of letting cottages to agricultural workers at the magnificent rental of 1s. 6d. and 2s. a week. No one will suggest that it is possible to replace cottages of any kind on which you can get an economic return with a rent of that sort, and, even if you raise the rental to what is the general rental throughout the country, 3s. and 3s. 6d., it does not begin to touch the problem. I have been faced recently with the replacement of cottages——

The CHAIRMAN: The hon. and gallant Gentleman is getting rather wide from the Death Duties; he is not dead yet.

Major ELLIOT: If the hon. and gallant Gentleman is not dead now, he must be some day, as all of us will be. We are dealing with the Death Duties, and I cannot imagine anything more germane to the subject than their effect on the housing of the people.

Major DAVIES: I was using it as an illustration of my main speech. Although I am not dead—although some of my friends opposite may say that I am practically as good as dead—I have to
make provision in the event of the next omnibus which the Minister of Transport puts on the road running over me; it is an important question to my family, and legislation of this kind vitally affects the workers in the countryside. If hon. Members knew the innumerable responsibilities and activities connected with the ownership of land, even in a very small way, they would appreciate how day after day matters of re-equipment, repairing and replacements come up. Anyone who goes round the countryside to-day, and meets farmers who for various reasons, after being tenants for long years, have been compelled to buy their farms, will find them saying, "I have now the worst landlord I ever had; I have bought my own farm." The reason is that this form of legislation, which is a capital levy by instalments, gradually, death by death, takes a great amount of the capital resources of the land. But the matter does not end there. When a predatory Chancellor of the Exchequer, to whatever party he belongs, says at the death of a person that the estate has to pay a certain amount in Death Duties, he insists that it shall be paid to him in the most liquid form of capital, that is cash; and immediately, whether it be in agriculture or in any other industry, it does not matter how properously it is working or how extensive its resources are, it has to make some form of realisation in order to turn its assets into liquid capital to pay over to the State, and the State at once spends it as revenue for the year.
10.0 p.m.
The whole principle is vicious, and every time there is an opportunity of bringing it before the nation and before the House we are justified in doing it, because, if even there were a time when this was a shortsighted and foolish policy, it is to-day, when we are faced with the ever-increasing struggle of industry to provide employment. It is a much less vicious principle to tax revenue than it is to sap the capital resources of the country. Although I am not so foolish as to hope that this Clause will be withdrawn and reconsidered, I welcome the opportunity of ventilating the subject and hoping that at some future time some Chancellor of the Exchequer will realise the vital principle that is involved, and readjust accordingly the revenue in the Finance Bill of the year.

Mr. TINKER: I did not gather from the hon. and gallant Gentleman whether he was attacking the principle of Death Duties or the increase in the present year, but he told us that the country would be ruined by this increased taxation. I have one or two figures to show how far this ruination has gone. In 1913–14 the estates passing at death amounted to £296,000,000. In 1928–29 the figure increased to £525,000,000. It seems, therefore, that the Death Duties are not ruining the country.

Mr. A. M. SAMUEL: Has the hon. Gentleman taken into account the change in the index value of money?

Mr. TINKER: I am giving the plain figures, and just a plain statement of the increase of the estates.

Major DAVIES: The hon. Gentleman is getting on very dangerous ground in just quoting statistics. Statistics of that sort are always misleading, but two things stand out prominently. This vicious process has gone on to such an enormous extent in the period which he has mentioned that, if we have regard to the amount of capital resources of the country that have been swallowed up and spent in the expense of running this country, his figures show that the case is worse than I tried to point out.

Mr. TINKER: I am just pointing out the increase in the estates. The hon. and gallant Gentleman is trying to point out that we are wasting the money, but where is the money to come from to meet the expenses of running the country? It must come from somewhere, and we think that the Estate Duties provide the best means. Not one on the other side has touched on it. The rate on an estate of £120,000 is increased from 21 per cent. to 22 per cent. If I may judge hon. Members on the other side by those who have spoken, I assume that many of them are worth £120,000. From the remarks of the hon. and gallant Member who has just spoken, I take it that this increase will be bearing upon him. Is that so?

Major DAVIES: Not for a moment should I try to represent a case for my own personal benefit. I am representing a much wider interest than that. I am not talking about the increase as it may affect a few millionaires, but as it may
affect the welfare of the whole community, and not least the working classes.

Mr. TINKER: We are dealing with Clause 28, which is concerned with the increased Death Duties. I take it we shall not be allowed to deal with the principle, but only with the increase which is provided for by the Clause. [HON. MEMBERS "No!"] I take it to be so.

The CHAIRMAN: We are only concerned with the Clause.

Mr. TINKER: With the increase provided by the Clause. I contend that in this Budget the Chancellor of the Exchequer has followed the only possible course. The increase of just over £3,000,000 in the amount to be raised by Estate Duties is certainly not excessive, and if there could be an alteration I assure hon. Members opposite that we should fight most strenuously for a greater increase than that for which he is budgeting. I wish the question of whether there should be a still further increase could be thrown open to a free vote of the Committee. I would willingly accept the challenge on behalf of these benches as against the benches opposite. I am looking forward to the time when there will be a greater increase in the Estate Duties than is imposed by this Budget.

Sir BASIL PETO: There is only one moral to be drawn from the speech of the hon. Member for Leigh (Mr. Tinker), and that is that if the majority in the House were to be given free play they would, he thinks, vote for almost any possible increase in the yield of the Estate Duties that could be proposed. I think the present Budget raises the amount which we expect to receive from Death Duties from £80,000,000 to £83,000,000. We are entitled to ask, if this process is to go on indefinitely, where future Chancellors will get their Estate Duties from when the present generation have all "handed in their checks." It is very obvious that we shall rapidly get to the end of this source of revenue. Hon. Members must recall the old proverb, "You cannot eat your cake and have it." If we eat the cake every year in larger and larger slices, there will be less and less for successive Chancellors.
I wish to deal with the increase in the Estate Duties from another and a closer
point of view. Any Chancellor proposing an increase in the Estate Duties ought to justify it on principle. In 1925 the right hon. Member for Epping (Mr. Churchill) increased the yield of Estate Duties by about £10,000,000, but in the same year he reduced the Surtax by an almost exactly similar sum. He justified that action on the ground that the living were better able to divert their savings and their capital resources to the assistance of industry than were the dead. He said, "If I leave £10,000,000 more a year in the hands of the living, presumably it will be saved and the savings will be invested directly in industry and will form a source from which industry can find new capital." On balance he felt it to be to the advantage of the country, in the state in which industry then was, to reduce the Surtax and to increase the yield from the Estate Duties.
What does the present Chancellor do? Under Clause 8 he raises the rate of the Surtax and under this Clause he raises the rate of the Estate Duties on larger estates, so taking money both ways. He takes more from the potential savings of those with large incomes, money which would be available to furnish fresh capital for industry, and squanders it in various ways, and also takes a larger slice from estates passing at death. In two directions, therefore, the reservoir from which fresh capital is drawn will be depleted. That is his contribution towards helping the present industrial depression, although the rationalisation of industry, on which the Government are so greatly depending, involves finding enormous new capital sums. There is another way in which this increase will affect industry. Whenever a large employer of industry dies there is bound to be a great dislocation in industry, and the greater the levy that is made upon capital passing at death the greater the disturbance. The hon. Member for Leigh has been pointing out that the sum under contribution for estate duties will be £200,000,000 more. We are, therefore, disturbing to that extent more the capital resources of industry.
What is the main justification for the Estate Duties at all? It is that the country owes a gigantic sum as National Debt—mainly War debts due to the various holders of the national stock;
and we are supposed to say that it is a reasonable thing to levy on those estates that pass at death a certain sum by which we may reduce the indebtedness of the nation and so find relief for industry, indirectly, by having to find a smaller sum year by year. There is no justification for the increase proposed in this Clause on that ground. We have been told that the services of the National Debt need about £55,000,000 a year, and I remember the Chancellor of the Exchequer pointing out that the National Savings Certificates also demanded a large sum, and putting the two together about £70,000,000 was required for that purpose. The yield of the Estate Duties was £80,000,000 and the right hon. Gentleman now proposes to raise it to £83,000,000. It is clear that the increase which is proposed under this Clause is not going to be spent on the redemption of capital, but is going to be spent in order to give more than £10,000,000 to the annual needs of the country in regard to social services and things of that kind. I hold that the very worst way of raising revenue for national services is taking the capital required in industry, and doling it out, week by week, in one form or another for social services. That is the Rake's Progress. It is a process which, if adopted by any private individual in his daily life, would obviously result, if he lived long enough, in bankruptcy.
I would like to say a few words from the point of view of the great landed estates and what will happen to them under this Clause. It is quite true, as the Financial Secretary has already pointed out, that the Schedule under the Finance Act of 1925 is the basis of the present Clause, and that under that no increase was made over the rates of 1919 in the Estate Duties on estates of agricultural value. There is an enormous difficulty, which is increasing as death after death occurs, in finding the means of carrying on in any way at all the great obligations which have been placed upon landed estates. I think we have a right to expect from the present Government a clear pronouncement as to whether they believe in the nationalisation of the land or whether they do not.

The DEPUTY-CHAIRMAN: The hon. Baronet must confine himself to the subject-matter of this Clause which is an
increase in the Estate Duties. He cannot discuss the nationalisation of the land or kindred subjects.

Sir B. PETO: Of course, I will bow to your Ruling, Mr. Dunnico, and I was only dealing with the question of the method of the payment of the Estate Duties. I am coming to the question whether we are not entitled, when the Estate Duties are raised on the larger landed properties, to get a decision from the Government as to whether they will accept land in payment of those duties. It is a very vital question, because, if cash is required in every case, the question immediately arises as to how that cash is to be provided, and I hope that you will allow me to deal very briefly with that question in a moment. At present I want to call attention to the fact that there is now under offer to the Government a large and valuable portion at one of the most picturesque parts of Great Britain, part of the property of the Duke of Montrose on Loch Lomond, for the purpose of a great national park. The question which is still under consideration, and has not been decided, is whether that land, offered in payment at Estate Duty, should be accepted or not. Surely, when we are considering the question of an increase in the Estate Duties, it is very pertinent to consider how those duties are to be paid. Either they must be paid in cash—in which case, if the estate is to be carried on at all in the future, the cash must be provided by insurance or by some other means, and obviously the only effective means is insurance—or by offering to the Government, and by the Government accepting, a portion of the estate, so that, if a smaller estate is handed on to the successor, it can be administered properly with an adequate capital to enable the successor after the death to carry it on as it has been carried on, for the benefit of all who live by it.
Personally, I am not enamoured of the State taking over large sections of the land of the country on the death of every large landed proprietor, but, in the absence of any decision on that matter, we are clearly entitled, when the Estate Duties are raised to their present level, to ask the Government how estates are to be carried on after these great sums are
deducted from the capital value of the estate at every succeeding death. I should like to say just a word with regard to the question I raised on two Amendments which I put down to this Clause, and which the Chairman decided should be raised as a new Clause. I think that it is applicable on the Question, "That the Clause stand part of the Bill." The more the Estate Duties are raised, the more easy should the Government make it for those who have to provide for the payment of these Duties, and the only effective method of so providing is by taking out large insurance policies, so that the successor to the estate may have the resources with which to carry on the estate in the future.

The DEPUTY-CHAIRMAN: The hon. Member is now trying to discuss an Amendment which it has been decided must be raised as a new Clause. Obviously, he cannot raise subjects which it has been decided are not appropriate to the Clause under discussion.

Sir B. PETO: I do not want to discuss it at all, but would like merely to put to the Chancellor of the Exchequer the general proposition that, the more the Estate Duties are raised, the more necessary it is to consider how those duties are to be paid. I am not sure that we ought to leave the matter in its present haphazard condition. We are making no provision with regard to the State taking over part of these landed properties——

The DEPUTY-CHAIRMAN: The hon. Member is entirely out of order. He is entitled to discuss the scale, but the methods of payment do not arise on this Clause.

Sir B. PETO: I quite agree. I merely wish to point out that, the higher you make the scale, the greater you make the problem, and there is no doubt that it is being felt more and more all over the country that the position, particularly in regard to landed estates, is becoming impossible. The scale indicated in the new Schedule rises, in the case of the largest properties, to 50 per cent. Of course, it is not all property in land; it is a question of property in land and the other necessary outside property which is essential to carrying out the obligations attaching to any landed property. In the aggregate, in
the case of a property even of such a moderate value as £120,000, invested in general securities and in land, the scale is raised; and the question for the Government is how we are to go on year after year increasing the scale of these Death Duties and not really facing the problem how estates can possibly be carried on. We are getting very close to the point of the nationalisation of land when we are raising the Surtax and the Estate Duties. Then we shall have to settle how it is possible to carry on the agricultural industry. I greatly regret that the Chancellor of the Exchequer has thought it necessary, in his very first Finance Bill, to introduce this vicious principle of taking a larger and larger annual amount of the capital invested in the most essential industries of the country and spending it on the current needs of the Treasury. It is most unfortunate that he should do so at a time like the present, when industry is demanding fresh sources of capital for reconstruction, and that, by way of his contribution to the unemployment problem, he should be denying the industry the capital which is so urgently required.

Mr. A. M. SAMUEL: I have listened to pretty well every speech that has been made since the Budget was introduced, and I have asked myself: "Are the Government never going to bring in a constructive Bill to add to the wealth of the country?" Every action of the Socialist party seems directed towards dividing up existing wealth. Here we have a Clause which, by increasing the Death Duties, carries forward what seems to be part of a spiteful satisfaction in dividing up the wealth of others. There must come a time when, if you increase your Death Duties, you will not have very much left to divide up. My hon. Friend has spoken of the effect of these forms of taxation upon land. I do not own a foot of land, but, I have been connected all my life with industry. I have seen many factories in the great provincial cities which are not owned by companies, but are owned by a family or by a proprietor who has sunk every farthing he has in his factory, in machinery or buildings or materials. When he dies a large slice of money has to be found to pay the Estate
Duties. If a man owning a factory worth £120,000 dies, over £20,000 has to be found somewhere. If the widow, or the sons or the partners are careful men, they do not like to borrow, and they will not borrow. They restrict their business. They say, "We will draw in our horns. We will pay what the State asks us to pay and we will go on again."
The very persons whom I presume hon. Members opposite wish to help are the first to suffer. It leads to a restriction of employment. Owing to the high prices of manufacturers' goods in England, it is very difficult for such goods to be sold in the competitive markets of the world. We are trying in our competitive industries to keep down costs, but here you have a larger and heavier clog put upon industry by reason of the Second Schedule increasing the cost of Estate Duties. The Germans at the present moment, while we are struggling with these heavy costs—the right hon. Gentleman may laugh. I have been in trade all my life helping to make goods, and I am only too conscious of the difficulty of selling them.

Mr. P. SNOWDEN: I am not laughing.

Mr. SAMUEL: I hope the right hon. Gentleman is not laughing. I have experienced difficulty in selling my goods in the markets of the world. We are trying, as far as we can, to rehabilitate and reorganise our factories. What are the Germans doing at this moment while we are bearing this big burden of extra costs? I received this morning a note from some friends in America to say that while we are struggling with increased taxation the Germans are now preparing to make cuts in leading lines of 7½ per cent. in wages and 10 per cent. in selling prices. That is what we are up against. Our competitors will try to filch our trade from us while we are increasing our costs. We ask the Chancellor of the Exchequer to pause for a moment in order to see the mischief which is being done by placing heavier costs on our industries. I was interested to hear my hon. and gallant Friend the Member for Yeovil (Major Davies) state that certain persons deplored the fact that there had been no capital levy put upon British wealth, and I believe that it, was said by the Financial Secretary, if not by the Chancellor of the Exchequer, some days ago that
it was a pity no capital levy was put on wealth at an earlier date. What more do hon. Members want?—[An HON. MEMBER: "A lot more."] It is a capital levy which they have here. Here is a capital levy. You cannot take more out of a vessel than there is in it. Here you have a scale of taxation raised to an extent which makes it stiffer than any capital levy which would have been put on at the time when hon. Gentlemen opposite wanted to put it on.
A question was asked the other day and a reply was given to me across the Floor of the House by the Financial Secretary in which he said there were roughly rather more than 25,000 persons in the country whose incomes were in excess of £5,000 a year. Capitalised at 5 per cent. it means that there are only 25,000 people out of 45,000,000 people who have a capital of over £100,000. When you are increasing this capital levy charged on savings you are penalising—not the millionaires because there are very few of them; you may not find more than half a dozen or a dozen in a year—but the main body of people you are penalising are those who keep industries at work and provide the life-blood of the trade which provides your taxes. What inducement is there for individuals to save? I presume that the right hon. Gentleman takes the same view as the President of the Board of Trade took when he made a speech at this time last year and said that it was necessary for us to save in order to refill the pool which feeds trade. Imagine a man saving £100. He invests it at 5 per cent. Income and surtax are taken off, which brings the interest down considerably. A portion of his savings is also taken away from his children when he dies.
No one will save in those circumstances. It will not pay them to save and invest. They take the view that if they save they are heavily taxed and that when they die a portion will be taken away from their

children, they spend before the tax-gatherer gets the money. These high Estate Duties also act detrimentally to the extension of businesses and they also prevent the setting up of new businesses. Such duties at such a high rate have a repercussion upon the Exchequer, because when a man dies and his securities have to be thrown upon the market the price of that class of security is depressed and it takes some time to recover, with the result that the Exchequer loses owing to the decreased capital value in the next deceased estate and less stamp duty on the securities as they are transferred, and upon which transfer stamp duty has to be paid.

Another effect of these high duties is that when men are reaching a certain age they say to themselves: "We will divide up our estates, honestly and properly, among our children." This applies not only to estates but to money. They say to themselves: "If we die within three years of the division of our property it will have to bear the Estate Duty, but if we live for more than three years afterwards our children will have the money without paying Estate Duty." No one can stop them doing that, and the result is that the Treasury loses the Estate Duty, which would otherwise be paid, by compelling these people to divest themselves of their property and investments to their children. In that way not only is the Treasury losing the Estate Duty which would otherwise be paid, but the total income which these men would own is reduced, and that reduces the poundage rate for surtax. I do not suppose that the Chancellor of the Exchequer will in any way moderate his delight to penalise wealth, but as a matter of grace he ought to make some speech in extenuation of his conduct.

Question put, "That the Clause stand part of the Bill."

The Committee divided: Ayes, 256: Noes, 156.

Division No. 386.]
AYES.
[10.38 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Baldwin, Oliver (Dudley)
Birkett, W. Norman


Adamson, W. M. (Staff., Cannock)
Barnes, Alfred John
Blindell, James


Addison, Rt. Hon. Dr. Christopher
Barr, James
Bondfield, Rt. Hon. Margaret


Aitchison, Rt. Hon. Craigie M.
Batey, Joseph
Bowen, J. W.


Alexander, Rt. Hon. A. V. (Hillsbro')
Bellamy, Albert
Bowerman, Rt. Hon. Charles W.


Ammon, Charles George
Benn, Rt. Hon. Wedgwood
Brockway, A. Fenner


Arnott, John
Bennett, Capt. Sir E. N. (Cardiff C.)
Bromfield, William


Aske, Sir Robert
Bennett, William (Battersea, South)
Brooke, W.


Attlee, Clement Richard
Benson, G.
Brothers, M.


Ayles, Walter
Bentham, Dr. Ethel
Brown, C. W. E. (Notts, Mansfield)


Baker, John (Wolverhampton, Bilston)
Bevan, Aneurin (Ebbw Vale)
Brown, Ernest (Leith)


Brown, Rt. Hon. J. (South Ayrshire)
Lang, Gordon
Ramsay, T. B. Wilson


Brown, W. J. (Wolverhampton, West)
Lansbury, Rt. Hon. George
Rathbone, Eleanor


Burgess, F. G.
Lathan, G.
Raynes, W. R.


Caine, Derwent Hall-
Law, A. (Rossendale)
Richards, R.


Cameron, A. G.
Lawrence, Susan
Richardson, R. (Houghton-le-Spring)


Cape, Thomas
Lawrie, Hugh Hartley (Stalybridge)
Riley, Ben (Dewsbury)


Carter, W. (St. Pancras, S. W.)
Lawson, John James
Riley, F. F. (Stockton-on-Tees)


Charleton, H. C.
Lawther, W. (Barnard Castle)
Ritson, J.


Chater, Daniel
Leach, W.
Roberts, Rt. Hon. F. O. (W. Bromwich)


Cluse, W. S.
Lee, Frank (Derby, N. E.)
Romeril, H. G.


Cocks, Frederick Seymour
Lee, Frank (Derby, N. E.)
Rosbotham, D. S. T.


Compton, Joseph
Lees, J.
Rowson, Guy


Daggar, George
Lewis, T. (Southampton)
Salter, Dr. Alfred


Dallas, George
Lindley, Fred W.
Sanders, W. S.


Dalton, Hugh
Logan, David Gilbert
Sawyer, G. F.


Davies, E. C. (Montgomery)
Longbottom, A. W.
Scott, James


Day, Harry
Longden, F.
Scrymgeour, E.


Denman, Hon. R. D.
Lowth, Thomas
Scurr, John


Dickson, T.
Lunn, William
Sexton, James


Duncan, Charles
Macdonald, Gordon (Ince)
Shaw, Rt. Hon. Thomas (Preston)


Ede, James Chuter
MacDonald, Rt. Hon. J. R. (Seaham)
Shepherd, Arthur Lewis


Edmunds, J. E.
MacDonald, Malcolm (Bassetlaw)
Sherwood, G. H.


Edwards, E. (Morpeth)
Macdonald, Sir M. (Inverness)
Shield, George William


Egan, W. H.
McElwee, A.
Shillaker, J. F.


Elmley, Viscount
McEntee, V. L.
Short, Alfred (Wednesbury)


Freeman, Peter
McKinlay, A.
Simmons, C. J.


Gardner, B. W. (West Ham. Upton)
MacLaren, Andrew
Simon, E. D. (Manch'ter, Withington)


Gardner, J. P. (Hammersmith, N.)
Maclean, Sir Donald (Cornwall, N.)
Sinclair, Sir A. (Caithness)


Gibbins, Joseph
Maclean, Neil (Glasgow, Govan)
Sinkinson, George


Gibson, H. M. (Lancs, Mossley)
McShane, John James
Sitch, Charles H.


Gill, T. H.
Malone, C. L'Estrange (N'thampton)
Smith, Ben (Bermondsey, Rotherhithe)


Glassey, A. E.
Mansfield, W.
Smith, Frank (Nuneaton)


Gossling, A. G.
March, S.
Smith, Tom (Pontefract)


Gould, F.
Marcus, M.
Smith, W. R. (Norwich)


Graham, Rt. Hon. Wm. (Edin., Cent.)
Marley, J.
Snell, Harry


Granville, E.
Marshall, F.
Snowden, Rt. Hon. Philip


Gray, Milner
Mathers, George
Snowden, Thomas (Accrington)


Greenwood, Rt. Hon. A. (Colne)
Matters, L. W.
Sorensen, R.


Grenfell, D. R. (Glamorgan)
Messer, Fred
Stamford, Thomas W.


Griffith, F. Kingsley (Middlesbro' W.)
Middleton, G.
Strauss, G. R.


Griffiths, T. (Monmouth, Pontypool)
Millar, J. D.
Sutton, J. E.


Groves, Thomas E.
Mills, J. E.
Taylor, R. A. (Lincoln)


Grundy, Thomas W.
Milner, Major J.
Thurtle, Ernest


Hall, F. (York, W. R., Normanton)
Montague, Frederick
Tillett, Ben


Hall, G. H. (Merthyr Tydvil)
Morgan, Dr. H. B.
Tinker, John Joseph


Hall, Capt. W. P. (Portsmouth, C.)
Morley, Ralph
Toole, Joseph


Hardie, George D.
Morris, Rhys Hopkins
Tout, W. J.


Harris, Percy A.
Morris-Jones, Dr. J. H. (Denbigh)
Townend, A. E.


Hartshorn, Rt. Hon. Vernon
Morrison, Herbert (Hackney, South)
Trevelyan, Rt. Hon. Sir Charles


Hastings, Dr. Somerville
Morrison, Robert C. (Tottenham, N.)
Vaughan, D. J.


Haycock, A. W.
Mort, D. L.
Viant, S. P.


Hayday, Arthur
Moses, J. J. H.
Walkden, A. G.


Hayes, John Henry
Mosley, Lady C. (Stoke-on-Trent)
Walker, J.


Henderson, Arthur, Junr. (Cardiff, S.)
Mosley, Sir Oswald (Smethwick)
Wallace, H. W.


Henderson, Thomas (Glasgow)
Muff, G.
Watkins, F. C.


Henderson, W. W. (Middx., Enfield)
Muggeridge, H. T.
Watson, W. M. (Dunfermline)


Hirst, G. H. (York W. R. Wentworth)
Murnin, Hugh
Watts-Morgan, Lt.-Col. D. (Rhondda)


Hirst, W. (Bradford, South)
Naylor, T. E.
Welsh, James (Paisley)


Hoffman, P. C.
Newman, Sir R. H. S. D. L. (Exeter)
Welsh, James C. (Coatbridge)


Hollins, A.
Noel Baker, P. J.
West, F. R.


Hopkin, Daniel
Oldfield, J. R.
Westwood, Joseph


Hudson, James H. (Huddersfield)
Oliver, George Harold (Ilkeston)
White, H. G.


Hunter, Dr. Joseph
Oliver, P. M. (Man., Blackley)
Whiteley, Wilfrid (Birm., Ladywood)


Jenkins, W. (Glamorgan, Neath)
Owen, Major G. (Carnarvon)
Williams, Dr. J. H. (Llanelly)


John, William (Rhondda, West)
Owen, H. F. (Hereford)
Williams, T. (York, Don Valley)


Jones, F. Llewellyn- (Flint)
Palin, John Henry
Wilson, C. H. (Sheffield, Attercliffe)


Jones, Henry Haydn (Merioneth)
Paling, Wilfrid
Wilson, J. (Oldham)


Jones, Rt. Hon Leif (Camborne)
Palmer, E. T.
Wilson, R. J. (Jarrow)


Jones, Morgan (Caerphilly)
Parkinson, John Allen (Wigan)
Winterton, G. E. (Leicester, Loughb'gh)


Jones, T. I. Mardy (Pontypridd)
Perry, S. F.
Wise, E. F.


Jowett, Rt. Hon. F. W.
Pethick-Lawrence, F. W.
Wood, Major McKenzie (Banff)


Jowitt, Rt. Hon. Sir W. A.
Phillips, Dr. Marion
Young. R. S. (Islington, North)


Kedward, R. M. (Kent, Ashford)
Pole, Major D. G.



Kelly, W. T.
Potts, John S.
TELLERS FOR THE AYES.—


Kennedy, Thomas
Price, M. P.
Mr. Charles Edwards and Mr. William Whiteley.


Kenworthy, Lt.-Com. Hon. Joseph M.
Pybus, Percy John



NOES.


Acland-Troyte, Lieut.-Colonel
Birchall, Major Sir John Dearman
Brown, Col. D. C. (N'th'l'd., Hexham)


Albery, Irving James
Bird, Ernest Roy
Brown, Brig.-Gen. H. C. (Berks, Newb'y)


Astor, Viscountess
Bourne, Captain Robert Croft
Buckingham, Sir H.


Atkinson, C.
Bowyer, Captain Sir George E. W.
Butler, R. A.


Balfour, Captain H. H. (I. of Thanet)
Boyce, H. L.
Butt, Sir Alfred


Beamish, Rear-Admiral T. P. H.
Bracken, B.
Cadogan, Major Hon. Edward


Betterton, Sir Henry B.
Briscoe, Richard George
Carver, Major W. H.




Castle Stewart, Earl of
Hacking, Rt. Hon. Douglas H.
Remer, John R.


Cayzer, Maj. Sir Herbt. R. (Prtsmth, S)
Hall, Lieut.-Col. Sir F. (Dulwich)
Rontoul, Sir Gervais S.


Chamberlain, Rt. Hon. N. (Edgbaston)
Hamilton, Sir George (Ilford)
Reynolds, Col. Sir James


Christie, J. A.
Hannon, Patrick Joseph Henry
Richardson, Sir P. W. (Sur'y, Ch'te'y)


Churchill, Rt. Hon. Winston Spencer
Hartington, Marquess of
Roberts, Sir Samuel (Ecclesall)


Cobb, Sir Cyril
Harvey, Major S. E. (Devon, Totnes)
Rodd, Rt. Hon. Sir James Rennell


Cockerill, Brig.-General Sir George
Heneage, Lieut.-Colonel Arthur P.
Ross, Major Ronald D.


Colfex, Major William Philip
Hennessy, Major Sir G. R. J.
Ruggles-Brise, Lieut.-Colonel E. A.


Courtauld, Major J. S.
Herbert, Sir Dennis (Hertford)
Russell, Alexander West (Tynemouth)


Courthope, Colonel Sir G. L.
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Salmon, Major I.


Cranborne, Viscount
Horne, Rt. Hon. Sir Robert S.
Samuel, A. M. (Surrey, Farnham)


Crookshank, Capt. H. C.
Hunter-Weston, Lt.-Gen. Sir Aylmer
Samuel, Samuel (W'dsworth, Putney)


Culverwell, C. T. (Bristol, West)
Iveagh, Countess of
Sandeman, Sir N. Stewart


Cunliffe-Lister, Rt. Hon. Sir Philip
Jones, Sir G. W. H. (Stoke New'gton)
Sassoon, Rt. Hon. Sir Philip A. G. D.


Dalkeith, Earl of
Kindersley, Major G. M.
Savery, S. S.


Dalrymple-White, Lt.-Col. Sir Godfrey
King, Commodore Rt. Hon. Henry D.
Shepperson, Sir Ernest Whittome


Davies, Dr. Vernon
Knox, Sir Alfred
Skelton, A. N.


Davies, Maj. Geo. F. (Somerset, Yeovil)
Lamb, Sir J. Q.
Smith, Louis W. (Sheffield, Hallam)


Davison, Sir W. H. (Kensington, S.)
Lane Fox, Col. Rt. Hon. George R.
Smith, R. W. (Aberd'n & Kinc'dlne, C.)


Dixey, A. C.
Leighton, Major B. E. P.
Smith-Carington, Neville W.


Dixon, Captain Rt. Hon. Herbert
Little, Dr. E. Graham
Somerville, A. A. (Windsor)


Duckworth, G. A. V.
Llewellin, Major J. J.
Spender-Clay, Colonel H.


Dugdale, Capt. T. L.
Long, Major Eric
Stanley, Lord (Fylde)


Eden, Captain Anthony
Lymington, Viscount
Steel-Maitland, Rt. Hon. Sir Arthur


Edmondson, Major A. J.
McConnell, Sir Joseph
Stewart, W. J. (Belfast South)


Elliot, Major Walter E.
Maitland, A. (Kent, Faversham)
Stuart, Hon. J. (Moray and Nairn)


Erskine, Lord (Somerset, Weston-s-M.)
Makins, Brigadier-General E.
Sueter, Rear-Admiral M. F.


Everard, W. Lindsay
Margesson, Captain H. D.
Thomson, Sir F.


Falle, Sir Bertram G.
Meller, R. J.
Tinne, J. A.


Ferguson, Sir John
Merriman, Sir F. Boyd
Titchfield, Major the Marquess of


Fermoy, Lord
Monsell, Eyres, Com. Rt. Hon. Sir B.
Tryon, Rt. Hon. George Clement


Fielden, E. B.
Moore, Sir Newton J. (Richmond)
Turton, Robert Hugh


Fison, F. G. Clavering
Morden, Col. W. Grant
Vaughan-Morgan, Sir Kenyon


Forestier-Walker, Sir L.
Morrison, W. S. (Glos., Cirencester)
Ward, Lieut.-Col. Sir A. Lambert


Fremantle, Lieut.-Colonel Francis E.
Morrison-Bell, Sir Arthur Clive
Wardlaw Milne, J. S.


Ganzoni, Sir John
Muirhead, A. J.
Warrender, Sir Victor


Gibson, C. G. (Pudsey & Otley)
Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)
Wayland, Sir William A.


Glyn, Major H. G. C.
O'Connor, T. J.
Wells, Sydney R.


Gower, Sir Robert
Oman, Sir Charles William C.
Williams, Charles (Devon, Torquay)


Graham, Fergus (Cumberland, N.)
Peake, Capt. Osbert
Windsor-Clive, Lieut.-Colonel George


Greene, W. P. Crawford
Percy, Lord Eustace (Hastings)
Winterton, Rt. Hon. Earl


Grenfell, Edward C. (City of London)
Peto, Sir Basil E. (Devon, Barnstaple)
Womersley, W. J.


Gretton, Colonel Rt. Hon. John
Purbrick, R.
Worthington-Evans, Rt. Hon. Sir L.


Gritten, W. G. Howard
Ramsbotham, H.



Guinness, Rt. Hon. Walter E.
Rawson, Sir Cooper
TELLERS FOR THE NOES.—


Gunston, Captain D. W.
Reid, David D. (County Down)
Sir George Penny and Captain Wallace.


Resolution agreed to.

Mr. P. SNOWDEN: I beg to move, "That the Chairman do report Progress, and ask leave to sit again." Although it is shamefully early we have got to the end of, I will not say the agreement, but the suggestion which was made, and I shall honourably abide by it. I trust hon. Members will feel some righteousness in going home so early and will be in a physical and mental condition when we resume the Committee stage of the Bill even to make more rapid progress.

Mr. CHURCHILL: I do not think that we ought to separate without my offering to the right hon. Gentleman the Chancellor of the Exchequer my congratulations on the solid achievements of to-day. How clear this casts before us the moral
"Suaviter in mode, fortiter in re."
Here you have a sound example of two methods applied in the passage of the Bill—the vinegar and the oil. Which is the better one? The second is a sort of
Æsop's fable. There is the traveller with the north wind blowing upon him and the more it blew the more he wrapped himself up, and then the sun came out and shone brightly on the traveller, and he divested himself of his cloak and yielded himself to the genial influence. The right hon. Gentleman has made progress to-day, but only progress in one element, namely, of time—and it is the time element which governs his affairs. I suggest to him to go one step further. I suggest to him to go one step further. Do not let him be checked by arbitrary feelings but go one step further. Let us have some compromise on merits, and we can wind up this business in due time. The right hon. Gentleman has already said he will consider all the Amendments to Clauses 29 and 30 which do not affect the main principles which he has in view and which we share with him, namely, to stop outrageous evasion of taxation. Let him consider carefully whether he cannot make his Budget a
Budget of the House of Commons as a whole. He has got to 'have his revenue and to balance his Budget, we know. We may not like the way he does it, but he has got to have it. But let him consider whether we cannot expedite proceedings on a much larger scale than we have done to-night by some give and take between the two sides of the House and by the acceptance of Amendments which meet the point of view expressed from these benches and also the point of view expressed with so much ability from the Liberal benches. [interruption.] Do not let hon. Gentlemen jeer at the Liberals when they are keeping them in office. Despise not the horse that is bearing you through the battle. I accept the Motion, but I do suggest to the right hon. Gentleman that it would be very well worth his while to consider whether the kind of arrangement which is possible in the sphere of time might not be very profitably extended to the sphere of merits.

Committee report Progress; to sit again upon Wednesday.

Orders of the Day — ROAD TRAFFIC [FINES].

Resolution reported:
That for the purpose of any Act of the present Session to make provision for the regulation of traffic on roads and of motor vehicles and otherwise with respect to roads and vehicles thereon; to make provision for the protection of third parties against risks arising out of the use of motor vehicles and in connection with such protection to amend the Assurance Companies Act, 1909; to amend the Law with respect to the powers of local authorities to provide public service vehicles and for other purposes connected with the matters aforesaid, it is expedient to authorise the payment into the Exchequer of all fines, whether imposed by courts of summary jurisdiction or otherwise, in respect of offences under the said Act or the regulations made under the Act.

The remaining Orders were read, and postponed.

ADJOURNMENT.

Resolved,
That this House do now adjourn."—[Mr. Parkinson.]

Adjourned accordingly at Three Minutes before Eleven o'clock.